Federal Housing Authority (FHA) is a mortgage insurance agency in the United States With this you can enjoy lower, more affordable rates because if you fail or late to make a payment, the lender still receives their money because it is guaranteed by the government. FHA protects the average American homeowners from losing their homes by regulating the interest rates and terms of mortgage on the loans insured. FHA mortgage is easy to obtain, enabling average income American families The FHA basically looks at the household income level and the calculated monthly payment for the loan, ensuring that the latter will not go as high as 31% of the income to ensure that clients will be able to meet up monthly obligations without creating stressful impact on their daily living.
FHA mortgage loan rates requires a mere 3% down payment. Fixed rate loans are calculated based on the credit record of the borrower and the current market indicators. Since the required down payment is less than 20%, the US mortgage market requires a counterpart insurance cost to the lender. FHA can help you refinance your mortgage loan even if you have bad credit. Because these loans are insured by the federal government, more people qualify for FHA loans than for traditional loans. The FHA mortgage refinance offers up to 95% cash-out refinance for old or new FHA mortgages; and up to 97% rate and term mortgage refinancing based on the home value. Likewise, there are benefits for those with existing FHA loans such as interest rate reduction program, no credit or income eligibility on certain loans, as well as easy and flexible amortization.
For mortgages with more than 15 years term, the annual mortgage insurance premium will be canceled if the LVR (Loan to Value Ratio) attains 78% level, and the homeowner fulfilled his payment obligations for 5 years. Another program is FHA reverse mortgage program, the loan will only be paid back if the person who availed it sells the property, waives ownership right through title transfer and moving out, or when deceased. The best thing about the FHA reverse mortgage is that those who avail the loan cannot be forced to vacate their homes.
