FHA Loans aren’t new. However, there’s not a lot of people that really know about them. As a Realtor, I see all types of loans used for all types of people, and that tends to make me forget that not everyone sees different loan types day in and day out.
I brought an offer to a seller– it was a GREAT offer all around. But Mr. Seller was unhappy with the type of loan that Mr. Buyer was using. It happened to be an FHA loan. In our contracts, we do write in what type of loan is being used, along with the amount of money being funded, so you can see how much a buyer is putting down. Well, with this deal, Mr. Buyer was putting down 3.5% of the purchase price. This was also a home in the $200k price range. So Mr. Seller was bewildered at how this buyer could and would get a loan with putting barely no money down, he wanted to know what happened to the 20% down payment.
Is your credit average or even below average? FHA loans might be the loan for you. Are you looking to buy a multi-unit home or duplex but also use it as your primary residence? Again, FHA loans might work best for you. Also, your interest rate tends to be lower than that of a conventional loan one.
So the key items are:
Low down payment
Low interest rate
Average or even below average credit scores allowed
Duplex or multi-plex home buying
Of course, there are other great things about FHA loans, and there are other not-so-great perks of a FHA loan. To learn all about the good, bad, and the ugly contact your mortgage lender or banker and talk with them. Don’t know one? Contact me, I know some great lenders.