FHA Mortgages are a good option for you if:

• You are buying your first home.
• You need more relaxed underwriting critera.  (You know what we mean!)
• You don't have a lot for a down payment.
• You want a low rate!  FHA rates are usually the best available!

• Underwriting is relaxed, compared to Conventional Mortgages.
• You need a score of 640 or higher.
• You need at least 3.5% for down payment.  You can take a gift from a parent for the down payment.
• You do not need a lot of money to qualify.  You only need to show you have the funds you need to close!
•  The seller can pay up to 6% of the sales price towards your closing costs.

There is no sugar coating the fact that FHA monthly mortgage insurance has gotten very pricey in recent years.  This is why we consider it an  option for a first time home buyer, that than the go to option it used to be.

FHA charges MIP (mortgage insurance premium) two ways.  When you close, you are charged 1.75% of the starting loan amount.  This fee is rolled into your loan balance.  The calculator at right is FHA specific, and will illustrate how this  works.

FHA also charges a monthly premium.  The factor determining how much you pay depends on the loan term, and the amount you have down.  If you put at least 5% down, the factor decreases slightly on 30 year terms.  But you pay it for the term of the loan, which is a serious negative consideration!  15 year terms have lower factors.