FHA and your Dream Home

For those people who are not familiar with the Federal Housing Administration (FHA), it is important to know that it is simply one of the branches of the government that has the basic function of being able to make sure that people can enjoy a better life, specifically through initiating a variety of housing programs for the citizens of the United States. This is being done by the agency through insuring a big portion of the home loans that are being applied by many Americans today. If you want to have your own house, one of the ways that can make such possible is to apply for a loan through the FHA. There are many people in the past who have decided to use this route, and it can be seen that they have been satisfied with such option. If you plan on doing the same thing, there are some things that you should keep in mind. One thing that you should understand is how the process works. Essentially, if you submit loan application through FHA, it is not the agency that provides for the loan. Rather, it just serves as the insurer of the loan that is applied to a mortgage broker. If in case there are any problems associated with the payment of the person who has applied for the loan, the lender will have to go to FHA in order to solve the problem, and not directly to the borrower. Because of this, there is a lower risk that is incurred by the lender, and there is a higher possibility that your mortgage loan will be approved, since it is backed up by a reliable government agency. Aside from the higher possibility that you will be approved when a loan is applied through FHA, such is also beneficial because it can give you the opportunity to enjoy lower mortgage rates. If you apply for a loan directly to a mortgage broker, the down payment that will be required can be as high as 15%. On the other hand, if you decide to apply for the same loan, the down payment that will be required through FHA can be as low as 3%. This will give you the opportunity to choose a better home. Other ways at which it will be possible for you to save from a mortgage loan applied through FHA would be the fact they do not their lenders to charge high origination fees. This fee is limited to less than 1%. More so, with the FHA, there is no more need to be charged with penalties for pre-payment. In the case of other mortgages, if you decide to hand in your payment in advance, you will be generally required to pay a certain percentage as part of the penalty for early payment. If you are still looking for an affordable way to have you own home, and perhaps a way at which the likelihood of being approved is high, you should definitely consider approaching FHA. With this option, you can have the chance to enjoy all of the benefits that were mentioned above.