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The Curious Bag
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By obtaining an FHA loan for the purchase of your first home, you are also able to choose from a variety of home loan programs, pay a lower down payment and closing fees and qualify under easier credit terms.
Facts
FHA loans are insured by the Federal Housing Administration, which encourages lenders to offer more affordable loans.
Types
There are different types of FHA loans, including those for teachers, police officers and buyers purchasing single-family, multifamily and HUD properties. First-time buyers may also choose between FHA loans that have fixed or adjustable interest rates.
Lower Down Payment
In some cases, you may pay a low down payment that is 3 to 5 percent of the home's price.
Lower Closing Costs
You avoid paying high closing fees because of limits established by the FHA. You are also able to add these fees to the balance of the loan and accept credit from the seller or gifts to pay for the closing costs.
Qualifying Terms
With FHA loans, it possible to qualify for a loan even if you have had a bankruptcy or foreclosure in the last two to three years.
Source:
FHA Single Family Mortgage Insurance Program
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