Federal Housing Administration loans (FHA) have been helping people finance homes since 1934. The Federal Housing Administration (FHA) which is part of HUD insures the loan so the lender can offer the buyer a better deal.
FHA loans in Massachusetts have become very popular and rightfully so. There are a number of reasons why the FHA loan program is being utilized by many borrowers as the preferred home loan choice.
Here is a summary of the reasons this may a good loan choice for you:
Anyone can apply and there are no income limits.
The FHA loan can be used for single or multi-family homes up to 4 units, condominiums, or manufactured homes.
As of this writing (November 2008) the FHA minimum down payment is 3% although this will be changing in January of 2009 to 3.5%. The FHA is a perfect program for those that do not have tons of money squirreled away.
The borrowers credit score can be much lower in order to get the loan. At the moment credit scores can be as low as 580 with very few credit adjustments compared to conforming loans.
Mortgage insurance is readily available and is cheaper than conventional loan programs. FHA also has a moratorium on their mortgage insurance costs which has reduced the cost for many home buyers.
The seller of a home can pay up to 6% in closing or buy down costs for a buyer.
The declining values policy is much more liberal and does not effect the mortgage unless the mortgage is utilizing the new temporary loan limits. The chart below summarizes the Massachusetts temporary loan limits.
One word of caution...The FHA program does not cover financing on a 2-4 unit condominium. So if you are looking at buying a duplex style townhome the FHA loan program would not be suitable for you.
The above information on Massachusetts FHA Mortgage Loans was provided by Bill Gassett, the team leader for the #4 RE/MAX Team in Massachusetts in 2007. Bill can be reached via email at email@example.com or by phone at 508-435-5356. Bill has helped people move in and out of many Metrowest towns for the last 22+ Years. Bill's office is conveniently located in the center of Hopkinton MA at 77 Main Street.
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