Federal Housing Administration (FHA) loans
The Federal Housing Administration (FHA) offers FHA-backed loans that are designed to help increase home ownership by low- and moderate-income families and first-time homebuyers. Because the FHA insures the loan, lenders can offer greater flexibility in lending guidelines.
Available for single- and multi-family homes, FHA loan financing options include traditional fixed-rate products and adjustable rate mortgages. Important benefits of FHA-insured loans include:
- Low down payment
- Minimal closing costs
- More flexible credit-qualifying guidelines
- No income limits
- Available for owner-occupied homes only, no investment properties or second homes
- Properties must meet HUD guidelines and be inspected by HUD-approved appraisers
- Non-occupant co-borrowers allowed
- No reserve requirements at closing
- 100% of down payment and closing costs may be a "gift"
- Seller may contribute closing costs