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Is an FHA Loan Right For Me?
Information on one of the best financial tools available today!  What can FHA do for me? FHA 203B Mortgages Purchase / Refinance Purchase or Refinance - FHA has some incredible qualities that a conventional loans does not offer, therefore we will always review both types of loans options and explain the differences. ►Bad Credit- FHA does not follow a FICO score matrix, per se. Instead it reads your credit report and interprets your willingness to repay. You can have a sub par credit and limited credit and still be approved. The key is documenting your explanation of why your credit has suffered in the past. ►Loan Limits - FHA maximum loan limit has now been increased so you may qualify. ►Maximum LTV- FHA will loan up to 97.75% in Massachusetts. ►Declining Market- FHA does not subtract from the maximum loan amount that it will lend due to the Declining Market designation. Conventional loans are subtracting 5% from their maximum loan limit. FHA does not. ►Assumable - All FHA loans are assumable. If you acquire an FHA loan for a low rate you can advertise that your loan can be assumed by a buyer. It can help sell your home. ►Rates - FHA loans price similar or sometimes better than conforming loans. So, if you have bad credit you're not penalized much like a sub-prime loan. ►PMI- (Private Mortgage Insurance) - FHA is an insurance company therefore every FHA loan, no mater what the LTV comes with PMI. However, the monthly mortgage insurance premium payment is much lower. Don't be afraid of this. ►How Long To Close? - FHA only takes longer to close if your mortgage company is inexperienced. We close FHA in the same amount of time it takes for conventional loans. Many mortgage companies have never seen an FHA loan. FHA takes experience and talent. We are closing loans where others are failing. ------------------------------------------------------------------------------------- FHA 203K REHAB Mortgages Click to Apply Most mortgage financing plans provide only permanent financing. That is, the lender will not usually close the loan and release the mortgage proceeds unless the condition and value of the property provide adequate loan security. When rehabilitation is involved, this means that a lender typically requires the improvements to be finished before a long-term mortgage is made. When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and construction loans) involves relatively high interest rates and short amortization periods. The Section 203(k) program was designed to address this situation. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property. To provide funds for the rehabilitation, the mortgage amount is based on the projected value of the property with the work completed, taking into account the cost of the work. To minimize the risk to the mortgage lender, the mortgage loan (the maximum allowable amount) is eligible for endorsement by HUD as soon as the mortgage proceeds are disbursed and a rehabilitation escrow account is established. At this point the lender has a fully-insured mortgage loan.  With the creation of the Sub Prime loan,
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