FHA Mortgage Financing

FHA Mortgage Financing

There are many potential benefits to going with an FHA loan when you buy your next home. An FHA loan allows you to buy a house with as little as 3% down, instead of the higher percentages required to secure many conventional loans. FHA loans are a great way for first time buyers, or anyone with a shortage of down payment funds, to buy a home. The FHA does not make home loans but rather insures them.

THe FHA pays the lender if a home buyer defaults. To get an FHA home loan, you'll need to have good credit and sufficient income to qualify for the loan. Figuring out how much of a loan you can afford is the first step in getting an FHA loan. For an FHA loan, your monthly housing costs should not exceed 29% of your gross monthly income. Total housing costs include mortgage principal and interest, property taxes, and insurance.