FHA home loans make it possible for many low to average income families to become home owners
. FHA loans are federally backed and provide a low interest rate. Here in you will find some main information regarding fha loan requirements and current FHA mortgage rates.
So What is a FHA Loan Anyway?
FHA loans are under the umbrella of the Federal Housing Administration (although they personally do not make loans to the home buyer). These types of loans were put together for people who might have issues meeting the income or down payment requirements of other traditional lending institutions. FHA loans are backed by funds from the federal government. These loans are offered at noticeably lower interest rates than those of most mortgage lenders. FHA requires that the home buyer must have at least 3.5% of the purchase price for a downpayment.
What are the current FHA mortgage rates today?
As with most lending situations rates do vary depending on the individual credit score and the length of the loan terms as well. Yet, recently we have see the rates stay lower than 4.4%. As well, beginning June 11th, 2012 the starting mortgage insurance rates on FHA loans were lowered from 1 percent to only 0.01 percent. Also as of this writing (June 20th 2012) the rate for a 30 year fixed loan is at 3.63%.
What are the FHA Loan requirements?
Those looking for a FHA loan must meet certain credit requirements. However, these requirements are often much more relaxed than those which are set by conventional banks or mortgage lenders. One of the biggest hurdles is making sure your debt to income ratio is not exceeding the allowed limit. This is to prevent the homeowner from investing in a home which they cannot actually afford.
These are just a few of the set FHA home loan requirements. It is best to seek the advice of a FHA Mortgage Broker. He or she will be able to guide you through the exact requirements and loan applications.
FHA home loans are one of the best solutions for a lot of potential home buyers. If you are seriously considering applying for such a loan contacting a FHA mortgage broker is the first step. FHA mortgage brokers are well versed in the FHA rules and regulations. They will do their best to make the application process easy and as least stressful as possible.