Arizona FHA Loan
Looking to purchase a property in Arizona? You will want an Arizona FHA mortgage company to assist you with financing the best property without any hassles. What FHA really offers is some of the most competitive home loans with a lot of benefits for you as a home buyer like easy pay back installments. Arizona has been on the hot property list for quite some time now especially more so due to its high foreclosure rates.
The Arizona FHA Loan is available under different guidelines set by the Department of Housing and Urban Development or HUD. A FHA loan is basically a mortgage, which is insured by the Federal Housing Administration but the FHA doesn't provide mortgages to borrowers. It is the mortgage lenders associated with underwriting FHA loans who have the authority to sell you a loan. The FHA provides insurance to the lender so that they can offer you a loan without being at a high risk, this means more people can qualify to buy or refinance a home.
So if a borrower defaults on their Arizona FHA mortgage company loan then the FHA would take responsibility to cover the loss incurred by the lender. It is like the government giving banks a guarantee so that it is easier for the bank to offer you a loan. The requirements in an FHA mortgage can be met with ease as compared to other types of loans. This is because the government stands behind your loan and insures the bank or the lender.
There are a lot of people who might think that the Arizona FHA loans are only designed for first time home-buyers but that is nothing more than just a myth. The reality is that anyone can get a FHA loan. Of course there are certain limits depending on the FHA loan limit amount. The myth exists because it has been seen that more often it is a first time home buyer who ends up taking an FHA loan.
FHA loans have a qualification requirement just like any other type of loan and it is like a nice gift from the government to the people who would find it difficult to qualify for a mortgage in a normal scenario.
Inspite of all this, there are certain salient points to the AZ FHA loan that you need to remember like:
- You will not be able to use the FHA loan to buy an investment property nor can you use it to buy a second home
- You may not be able to take out an FHA loan if you have defaulted on other loans, have unpaid judgements or unpaid taxes on your credit report
- You will not be able to take out an FHA loan if you have defaulted on a student loan.
- You will be required to use full documentation for an FHA mortgage, which means that you need to provide proof of your earnings.
Advantages of a Arizona FHA mortgage
Here are some of the advantages of a FHA mortgage
- There is no credit score qualification requirements. Whether you have no credit at all, a 515 or 800 credit score. It doesn't matter. The Arizona FHA loan looks at credit quality, not credit score.
- If you don't have any credit then its not a problem at all. You can use alternative examples of credit like getting a letter from your landlord stating that you have been paying your rent without fail for the last 12 months.
- Thirdly, you can use grants or charity to create a zero-down FHA loan, which means that you can buy a house, under the right circumstances, even if you don't have the down payment requirements.
The state of Arizona has seen a high growth in the number of foreclosures with filings in Phoenix increasing by 35% in August 2005. There has been one filing for every 437 households and as a result, more real estate properties are available in Arizona for those who are looking to buy a home at an affordable price.
One of the best thing about an Arizona FHA home loan is that the interest rate is typically lower than conventional loans as compared to other types of loans. Other benefits include:
- You can get the closing costs on Arizona FHA loans paid by the seller
- There will be lower monthly mortgage insurance premiums
- Underwriting is much more flexible as opposed to conventional loans