We will assist to approve your ​Government FHA Loan!

FHA loans are issued by approved lenders and are intended for borrowers that have a low to moderate level of income. These loans are backed by the Federal Housing Administration and make securing loan easier for people with a lower credit score and who cannot pay a standard 20 percent down payment for a conventional loan.

The FHA loan lets you borrow a substantial amount of the value of the home. Thus, if your credit score is a 580 or above, you may only be required to put down as little as 3.5 percent. If your credit rating is lower than a 580, you may still qualify for a loan with a 10 percent down payment. Down payments for this loan can come from your savings, as a gift, or through an assistance program. These aspects make the FHA loan very popular among first-time home buyers.

FHA Mortgage Insurance

As an added protection, your lender will require you to pay two types of mortgage insurance.

• Upfront Mortgage Insurance: Upfront insurance is a lump sum usually between 1.5 and 2 percent of the amount you are borrowing. It can be paid out of pocket, the seller can agree to pay it as an added perk to purchase from them, or you can have the insurance amount rolled into your mortgage loan amount. If you choose to have the upfront amount added to the loan amount, you will pay a slightly higher monthly mortgage payment because your loan amount is higher.
• Annual Mortgage Insurance Premiums: These insurance payments are paid monthly and range from around a half percent to 1 percent of your loan amount. The percentage and length that you need to carry the insurance are determined by the specifics of your loan.

Benefits of an FHA Loan

Since you are required to pay added insurance premiums, the lender is able to allow you to pay a smaller down payment. This is because the insurance helps protect the FHA if you were to default on your mortgage payment.

FHA home loans Bend Oregon also make it easier for you to qualify for a loan. The requirements are not as strict as with other loans. A lower credit score does not automatically disqualify yours from securing a loan. Smaller down payments and a more flexible debt-to-income ratio also make it easier to qualify.

​Another aspect that many find attractive is the fact that your insurance premium will not be affected by a bad credit score. So, whether you have a score to brag about or a score that is cringe-worthy, your rates will not be influenced and will be lower than what you would pay on conventional home loans in Oregon.

Disadvantages of an FHA Loan

Any loan will have a downside, and the FHA loan is no exception. The total mortgage insurance associated with FHA Loan Requirements is greater than any other low-down payment loan. Though it is a very small increase in the monthly amount you will pay, over time it adds up.

The insurance gives you another little road bump. Unlike conventional mortgage insurance that you can cancel once you have built up enough equity in your home, you cannot get rid of the required FHA mortgage insurance. According to the FHA loan requirements, you are stuck with it for the life of your loan.

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