FHA LOANS… In today’s market, many homebuyers have heard that 100% loan programs are gone, but that’s simply not true.  It’s just one of the reasons we might suggest that you consider theFHA loan. An FHA loan is insured by the Federal Housing Administration, a federal agency within the U.S. Department of Housing and Urban Development (HUD). The FHA does not loan money to borrowers, rather, it provides lenders protection through mortgage insurance (MIP) in case the borrower defaults on his or her loan obligations. The rates on FHA loans are generally market rates (not like much higher subprime loans), while down payment requirements are lower than for conventional loans.

1. Low Downpayment:  FHA considers the total investment into the transaction.  They require a 3% investment into the property - and this can come from money you have on hand, a gift or a downpayment assistant program.
2. Easier to Qualify:  FHA is insured by the Federal Government.  Because of this, more lenders are willing to give loans with lower qualifying requirements.
3. Less than Perfect Credit:  FHA is more forgiving regarding Credit Boo-Boos than other programs, including bankruptcy.
4. Lower Interest Rate!  YIPPEE!  Unlike SubPrime loans which carried higher interest rates (because if you’ve had some slow credit - you’re a higher risk), FHA loans have very competitive interest rates.  Always compare FHA loans with other loan types.
5. Avoid Foreclosure:  No one goes into the purchase of a home thinking something bad will happen - but it might.  FHA has been around since 1934 and they were created and continue to demonstrate that they want to help you should you encounter hard-times.

VA Loans

VA guaranteed loans are made by lenders and guaranteed by the U.S. Department of Veteran Affairs (VA) to eligible veterans for the purchase of a home. The guaranty means the lender is protected against loss if you fail to repay the loan. In most cases, no down payment is required on a VA guaranteed loan and the borrower usually receives a lower interest rate than is ordinarily available with other loans.

Other benefits of a VA loan include:

• Negotiable interest rates at attractive rates.
• Closing costs are comparable and sometimes lower than other options.
• No monthly mortgage insurance (like FHA and Conventional loans)
• Right to prepay loan without penalties
• The Mortgage can be assumed by the buyer when a home is sold.

Although mortgage insurance is not required, the VA charges a funding fee to issue a guarantee to a lender against borrower default on a mortgage. The fee may be paid in cash by the buyer or seller, or it may be financed in the loan amount.

A VA loan can be used to buy a home, build a home and even improve a home with energy-saving features such as solar or heating/cooling systems, water heaters, insulation, weather-stripping/caulking, storm windows/doors or other energy efficient improvements approved by the lender and VA. These loans are made to Veterans and their married spouses (with few exceptions).

Veterans can apply for a VA loan with any mortgage lender that participates in the VA home loan program. A Certificate of Eligibility from the VA must be presented to the lender to qualify for the loan.

OTHER GOVERNMENT OPTIONS:  For more information about FHA financing, VA loans or USDA loans check out http://www.ncfhaexpert.com