April 2, 2015
If you have never explored your FHA loan options before, you should know what your options are for both refinance loans and new purchase loans. Did you know that FHA mortgages have, in most cases, a lower down payment requirement than conventional loans? The credit-qualifying rules for FHA loans and refinance loans is also more lenient than many conventional loans.
For new purchase loans, the type of property you can buy with an FHA mortgage is flexible. You can buy a typical suburban-style home, a condo unit, a mixed use building that is primarily residential in nature, and even a farm home (the loan would be for the residence only). Some lenders may also be willing to issue loans for manufactured housing or modular homes.
The type of loan you can apply for in a new purchase FHA loan transaction is also flexible. In addition to the traditional fixed-rate mortgage you may also be able to apply for an Adjustable Rate Mortgage (ARM loan) from the FHA lender, a Graduated Payment mortgage (GPM).
A graduated payment loan is for those who have incomes they expect to increase over time–you should speak with a lender about this option and whether it is right for you based on the type of work you do and your anticipate pay increases over the next few years.
When it comes to refinance loans, a participating FHA lender can offer qualified borrowers a variety of options including refinancing from a conventional, VA, or existing FHA mortgage. You can refinance from an adjustable rate loan to a fixed rate mortgage, refinance into another adjustable rate loan from the one you currently have, etc. You do not have to keep your existing lender to refinance into an FHA loan–any participating lender willing to work with you can help.
You can also apply for cash-out refinancing–borrowers who qualify can use the money back from an FHA cash out refinance loan for any purpose acceptable to the lender. This is a good option for those who need money back at refinance time to pay off student loans or other debt, and for those who want to remodel portions of their home.
You can get connected to a participating FHA lender about your FHA loan options or to get started on an FHA refinance application.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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