An FHA mortgage is a government insured mortgage. This article does a great job of explaining the FHA mortgage in detail. Click HERE to read the article.
A common misconception regarding FHA mortgages is that the MIP ( aka mortgage insurance) somehow protects the Borrower. This is not the case. The mortgage insurance premium protects the lender in the case of default. It really does not have any benefit to the Borrower outside of allowing for more lenient lending guidelines.
An FHA mortgage is a very flexible mortgage product. Because of this, it is the preferred loan structure for first time home buyers and those who do not have a lot of money for a down payment or those who have past credit issues who have reestablished credit.
The FHA loan has the following features:
A common misconception regarding FHA mortgages is that the MIP ( aka mortgage insurance) somehow protects the Borrower. This is not the case. The mortgage insurance premium protects the lender in the case of default. It really does not have any benefit to the Borrower outside of allowing for more lenient lending guidelines.
An FHA mortgage is a very flexible mortgage product. Because of this, it is the preferred loan structure for first time home buyers and those who do not have a lot of money for a down payment or those who have past credit issues who have reestablished credit.
The FHA loan has the following features:
- 30 and 15 Year Options
- Adjustable Rate Options
- Streamline Refinance Option
- Assumption Feature
- Renovation/Home Improvement Features
- Down Payment Assistant Options
- Preferred First Time Home Buyer mortgage structure