Home Buying in Philadelphia>Question Details

Malita215, Home Buyer in

Is the "HFA Preferred Risk Sharing" program considered a FHA loan?

Asked by Malita215, Wed Mar 27, 2013

http://www.phfa.org/consumers/homebuyers/hfaprograms.aspx#HF…

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Michael Torres’ answer
No, this is a conventional loan product. The HFA Preferred Risk Sharing program allows for just a 3% down payment, based upon acceptable credit score, and only allows a 3% seller assist. Therefore, depending on how the transaction is structured, it may require more money out of pocket for the transaction than going with an FHA loan merely because you may ask the seller to credit up to 6% of the sales price towards closing costs with an FHA loan. However, the monthly payment for that FHA loan will be substantially higher, which can have an impact on qualifying for a higher sales price. In my opinion, the PHFA HFA program is by far the better option, if you have the assets to make it work for your situation. Let me know if you have any further questions and best of luck!

Michael Torres
RE/MAX Reliance
215-275-2009
Michael@movinginmontco.com
http://MichaelsRealEstateBlog.com
0 votes Thank Flag Link Wed Mar 27, 2013
If this is not considered a FHA loan, why on the closing cost estimate there's a fee for "Upfront Mortgage Insurance"? I've been doing a lot of reading and they say this is for a FHA mortgage because the down payment is below 20%. With this program, I'm only required to put down 3%. However, am I still penalized?
Flag Fri Apr 5, 2013
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