FHA Loan Information

When considering the FHA loan program, there really are a number of issues which you should take into consideration. Give an expert 1st Continental Mortgage loan professional a call today at 1-888-427-5442 to discuss your situation. There is no obligation, and your information is treated in strictest confidence!

One of the most important issues relevant to the FHA Loan is in fact credit. While credit score is no factor, your credit quality is. The fact is, you're better off having no credit history, than having recent bad credit history. Primarily, an underwriter will need to know what caused any problems you might have had in the past, to ensure you have addressed and rectified these financial matters. If more recent, within the past 12 months, then we have a much more sophisticated process for getting a pre-approval. You can check out our Credit Repair section and the FHA Guidelines section for more details.

The second issue to give consideration to is the FHA loan limits. The fact is, there are not any Jumbo or Super Jumbo mortgage programs with FHA. These programs are not designed for these types of luxury properties, so you'll want to be certain you home, or your planned purchase amount, falls within the FHA loan limits.

With a refinance or FHA purchase, yes, the FHA closing costs can sometimes be $500 to $1000.00 more per month. There is also the issue of up front MIP (FHA mortgage insurance premiums) which will add to the costs to close, but this amount is financed by the lender. Before you get to discouraged, keep in mind that PMI (private mortgage insurance) is twice as expensive in your monthly payment, and is so because you're not paying any of it up front. Further, the PMI does NOT protect you, it protects only the lender. MIP with the FHA also protects only the lender, however, with the FHA loan comes government protections for you that you will NEVER get with a conventional or bad credit loan.

When rates are going up, typically, the FHA loan rates are lower. Why? It traditionally takes 3 to 5 business days for the rates to react to the market. So, when rates are going down, naturally, you have to wait before locking an FHA loan to give them time to catch up. Otherwise, FHA loan rates are typically as low as traditional interest rates in the conventional loan market.

We've taken time to attempt to help you understand all of the real negatives associated with the FHA loan. The fact is, the FHA loan program offers home buyers and homeowner, far more than any other program today. Most importantly, the FHA loan program offers you security and piece of mind. Something you can't put a price on. Give us a call today to learn how a FHA home loan can benefit your family.