In 1935 the FHA was introduced, it has been insuring loans ever since then. The FHA has been responsible for insuring over 35 million loans since its introduction. Most people are not so sure what the FHA does, to make it as clear as possible the FHA is responsible for insuring loans not issuing or funding them. They protect the lender by paying off your loan if you default.

During Bush’s presidency he had a modernization proposal pass through Congress so that more families could actually buy a home. At that time the FHA offered a rate of 5.5%. Those rates have since changed some, they are now for a 30 year fixed rate 6% with 1.875 points and for a 15 year fixed rate is 6% also but with 1.25 points.

There are a few reasons as to why an FHA loan could be your best option. This type of loan is good because perfect credit is not needed in order to qualify. Since the housing market is not so strong anymore lenders are becoming even picker when approving any potential borrower. The approval of a FHA loan will be determined by your income to debt ration and some other factors.

There are many people that are currently struggling but have filed for bankruptcy in the past and this can many times hold them back when applying for a loan. However even those that have filed for bankruptcy can be eligible for a FHA mortgage refinancing loan. It is recommended however that if you have filed for bankruptcy or have bad credit to speak and work with a credit repair agent. These professionals are most times able to increase your credit rating quickly and in a short amount of time. Along with improving your credit score these repair agents will guide you towards the proper steps that you will need to take.

The FHA loan will require you put some money down however it is usually is a modest amount. Using a FHA loan could be just what you needed. Contact a professional or make some calls yourself but act now. Save your home from foreclosure and look into getting a FHA loan.

-M Petrone

Subscribe via email

Enter your email address:

Delivered by FeedBurner