Interest rates are low, and thousands of homeowners are looking for the best way to buy a home at these historically low rates. However, not everyone has the money to drop a 20% down payment on a home. How can you take advantage of the market and get locked into a low rate and buy your new home if you can’t get a conventional loan with a 20% down payment? Three letters…
What’s an FHA Loan? An FHA loan is actually a mortgage loan backed by the Federal Housing Administration’s mortgage insurance. They are a federally assisted program that allows families to move into a home with minimal down payment. Right now, you can move into your home with a 3.5% down payment using FHA.
The loan program actually dates back to the Great Depression. It was initially created to provide banks with insurance as well as to help homeowners and new buyers during a time when the rates of foreclosures and loan defaults were increasing and people were being put out of their homes in record numbers.
FHA is now primarily seen a way for a new homeowner to follow their dreams and buy their first home, while guaranteeing the loan for the bank. Essentially it’s an insurance policy that guarantees the loan. This encourages banks to loan money.
The Home Loan Expert team also uses FHA to help people refinance to lower rates. Close to half of the refinancing that we do is accomplished through FHA. using the FHA Loan program will allow you to borrow up to 97.5 percent of the value of the house. A conventional loan limits you to a maximum of 90-95%.
FHA rates are also lower than traditional loans. It’s the same rate depending on credit score or amount or percent. A conventional loan has “adjusters” on the loan, changing the rates and percentages.
The Home Loan Expert Team actually underwrites FHA loans in house, and we’re a Direct Endorsed FHA Lender.
We also close more FHA loans than anyone else in the Midwest.
The FHA program is a great way to get the lowest interest rate on your mortgage and set yourself up for a low monthly payment on your dream home.
Mortgage rates are at historic lows, right now. This is the best time for you to buy a new home or refinance. Take advantage of lower mortgage rates to save money. Call us in St. Louis at (314) 781-9700, Chicago at (773) 770-4727, Indianapolis at (317) 550-1515 or Nashville at (615) 810-8555. You can always apply online at www.thehomeloanexpert.com, and we’re also open on Saturdays to better serve you. Don’t forget to follow @TheHomeLoanEx on Twitter for breaking mortgage news and knowledge. Nobody gets lower rates on better loans than The Home Loan Expert, Ryan Kelley, why go anywhere else?