Las Vegas Homes: Important Facts about FHA Loans
Many buyers of Las Vegas Homes
are unaware of the alternatives an FHA loan can
provide them. An FHA loan is a mortgage
insured by the Federal Housing Administration. Those who have applied for FHA
loans pay for mortgage insurance, which serves as protection for the lender in
case the borrower opts to default on the loan. Due to that insurance, the
lenders can offer good interest rates with less meticulous and more adjustable
qualification requirements.
Here are some lesser known facts that might
prove useful to those prospective buyers of Las Vegas Homes.
The FHA does not require a minimum credit
score for a borrower to be eligible. Each borrower’s creditworthiness is taken
into perspective. Even those who have filed for bankruptcy can still benefit
from the flexibility of a loan. Although some lenders have their own
requirements apart from the FHA guidelines, in which case, some might require
minimum credit scores.
The down payment requirement of the FHA is
only 3.5% of the original price, which draws attention for this type of funding.
You can also pay by other means, such as gifts from family members or grants
from a state or local government.
Some of the borrower’s closing costs are
allowed to be shouldered by the home sellers, builders and lenders. Additional
costs such as, an appraisal, credit report of tile expense can cause lenders to
increase interest rates if they are paying for the closing costs. A Good Faith
Estimate allows the borrower to evaluate the best possible option.
Since the FHA is not a lender,
but rather an insurance fund, borrowers need to get their loan through an
FHA-approved lender. However, not all FHA-approved lenders offer the same
interest rate and costs. Because of this, borrowers should still shop around in
order to find the best rate and terms available for them.
If potential buyers of Las Vegas Homes
are struggling to get
approved for a mortgage, FHA loans are an easier avenue to take toward
qualification. A better understanding of its inner workings might allow you to
take advantage of the flexibility and choices they provide.