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Catherine Condon's Blog

By Catherine Condon | Broker in Pepperell, MA

FHA Loans Gain Popularity

FHA Loans: Gaining Popularity

Working as a real estate broker with Integrity Residential Brokerage, I've noticed a significant increase in buyers utilizing FHA loans.  FHA Loans are mortgages issued by lenders and insured by the Federal Housing Administration (FHA). This federal government insurance gives lenders some assurance that they will be repaid if the borrower defaults. 

Even with the popularity of FHA loans, many buyers do not understand the potential benefits of these loans. Below, are some frequently asked questions about FHA Loans.

Are FHA Loans Only For Low Income Borrowers?  The good news is FHA loans are available to everyone. There are no income restrictions. Similar to most mortgage options, borrowers will need to supply proper documentation for income and assets which assures the lender that the borrower will be able to afford the home.

Are FHA Loans Only For First Time Buyers?  You could be a first time buyer or buying your 10th home, anyone who would like to apply for a FHA loan is able to do so. 

Aren't FHA Loans Just For Small Loans?  Recently, the government raised the maximum loan amount from its original cap of $362,790 to $793,750 in hopes that it will help stabilize the housing market. The amount a buyer can borrow might vary county to county, so check with a qualified lender in your area.  

Are FHA Loans More Affordable Than Conventional Loans?  While interest rates are comparable to other loan options, one of the greatest benefits of a FHA loan is that the downpayment could be as low as 3.5%. 

Are FHA Loans Assumable? Yes!  FHA loans are assumable. While the initial attraction of a FHA Loan might be the low downpayment, the potential to transfer the loan and it's terms (interest rate) to a buyer might make the property more desirable and possibly increase the value, especially if interest rates rise.

If you're considering a home purchase, speak with your lender about the possible benefits of a FHA Loan!

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Integrity Residential Brokerage, licensed in both Massachusetts and New Hampshire, would be happy to assist you in your home buying or home selling needs. If you, or anyone you know, is considering buying or selling a property, Integrity Residential Brokerage located in Pepperell, MA, would love to hear from you!  We strive to offer you the highest level of professional assistance possible making your desires and goals a reality.

If you'd like to search for property currently on the market, click on the link below.  You'll have access to every property currently listed in Massachusetts as well as New Hampshire.

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Catherine Condon, Broker MA & NH
(978)433-0000
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Comments

By Voices Member,  Sun Aug 22 2010, 08:30
Good, concise information Caroline. Richie
By Dayle Doherty,  Wed Sep 22 2010, 12:40
Excellent information, Catherine!

FHA loans currently make up 40% of the market and are exponentially increasing in popularity! If you can find a mortgage broker who does them, you should definitely look into it.

Also good to note is that anyone with an FHA loan with a rate of 5.5%+ should look into applying for a streamline refinance before Oct. 4th. On the 4th the legislation changes to decrease the up front mortgage insurance premium but increase the monthly mortgage insurance from .5 to .9. New FHA purchases will still be fine, but the window to save a ton of money on FHA refis is closing quickly. Qualified candidates should talk to an FHA mortgage broker today!
By Dayle Doherty,  Wed Sep 22 2010, 12:40
Excellent information, Catherine!

FHA loans currently make up 40% of the market and are exponentially increasing in popularity! If you can find a mortgage broker who does them, you should definitely look into it.

Also good to note is that anyone with an FHA loan with a rate of 5.5%+ should look into applying for a streamline refinance before Oct. 4th. On the 4th the legislation changes to decrease the up front mortgage insurance premium but increase the monthly mortgage insurance from .5 to .9. New FHA purchases will still be fine, but the window to save a ton of money on FHA refis is closing quickly. Qualified candidates should talk to an FHA mortgage broker today!
By Catherine Condon,  Wed Sep 22 2010, 12:59
Hi Dayle - thanks for the additional detailed information!
 
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