wanted to know the difference between FHA morgage loan ?
i wanted to know the difference between a FHA morgage loan and a loan which is not FHA , looking for 15 year or 30 yearh fix refi loans
- Quicken LoansLv 51 decade agoFavorite Answer
The Federal Housing Administration (FHA) insures loans to the lenders who give FHA loans. Which makes FHA loans a safe, secure choice for homeowners.
FHA loans are insured through a combination upfront mortgage insurance (UFMIP) and regular monthly mortgage insurance (PMI).
FHA loans have been particularly popular for home buyers, requiring only a small 3.5% down payment, which can come from a variety of sources. With the recent credit crunch, borrowers looking to refinance their loans are taking another look at FHA rather than conventional programs which have tightened their guidelines. FHA also allows up to 95% loan-to-value with a cash-out refinance.
Borrowers love FHA because it remains lenient towards lower credit scores and income (this is another big difference). FHA has even raised their loan limits on a nationwide level to boost the struggling housing market. More borrowers are realizing that FHA loans are a viable, lower interest rate, lower cost mortgage option that still offers security and more flexibility with credit scores.
- 1 decade ago
FHA is a government program that attempts to make qualifying for a motgage easier. The government acts as the mortgage insurer so that if you lose your job due to layoff, disability or other legitimate reason they will make your monthly payments for a given period of time.
There are private companies that do the same thing as described above but the FHA program may work better at convincing the mortage company to grant you the loan.
If you have a 20% down-payment, then the insurance I described above is optional and you would not need to go through FHA.Source(s): I have an FHA loan.
- golferwhoworksLv 71 decade ago
It has an up front MIP fee and that is based on credit scores but not less than 1.5% and it can be financed into the note. It also has a monthly MIP fee as well that is added to your payment and some last till the end and some are for 60 months. The loan is federally insured so if you have a defaulted student loan or the like you cannot get one.
These are the biggest differences
- Anonymous1 decade ago
The difference is simply that an FHA loan is guaranteed by the FHA. There are some different rules regarding loan qualification.Source(s): http://www.fha.gov
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- facerLv 44 years ago
A very own loan is secured against materials. A very own loan for a house many times runs till your retirement. A very own loan might properly be secured or unsecured. it many times has an extremely short lifespan while in comparison with a private loan.
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