IMPORTANT ANNOUNCEMENT : Immediate changes to FHA mortgage insurance
The Federal Housing Administration (FHA) is a federal agency under the US Department of Housing and Urban Development (HUD). Its purpose is to insure loans made to qualified borrowers, based upon laws and regulations of the government. These goverment guaranteed loans can be obtained by various banks and lenders who are approved by FHA. There are a number of sources where I can broker FHA loans, including my direct lending channel, Morgan Financial.
 FHA loans present little to no risk to the banks,
because their loan funds are guaranteed by the goverment in the event of default. While traditional banks and lending institutions may decline an applicant due to imperfect credit, FHA may approve that same borrower if he/she can truly afford to make the payments on the loan.
Not enough equity in your home to refinance with a good rate? Lenders in today's market have stricter standards on collateral so they can be better protected from loss. For you, this usually means you should have at least 20% equity in your property left over after they loan you the money. In some cases lenders will allow greater than 80% financing, but borrowers in this dilemna must pay monthly mortgage insurance or "PMI." 2007 & 2008 have proven to be difficult times in real estate, where many homeowner's hardly have any equity in the homes let alone 20%! For this reason, the Feds have stepped in through the arm of FHA to insure loans up to 97.5% of the value of your home. Bill H.R.5830 entitled "FHA Housing Stabalization and Homeownership Retention Act of 2008" has recently passed the approval of the House and Senate which is aimed at reducing foreclosures by encouraging banks to refinance homes for amounts GREATER THAN what the homes actually worth. If this Bill is approved by the President, upside down homeowners may have a real opportunity to reduce their rate, payment, and even the balance owing on their homes. To keep informed about this and other critical federal updates, email me at randymiguel@gmail.com.
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 FHA has re-opened the doors to refinancing homeowners with little equity, while traditional banks are refusing to lend. Today's credit markets have made borrowing money against our homes quite challenging, even for the "well qualified" borrower with perfect credit and income. Only FHA can offer loan amounts above 95% of your home's true value. On top of that, FHA will lend in situations with imperfect credit. Nowadays, it is quite common for a borrower to have neither the equity nor the credit to qualify for a traditional loan, but the perfect qualifications for an FHA loan.
FHA is not sub-prime. Interest rates for FHA loans, specifically 30yr fixed products, are actually lower than traditional bank rates! Please do your due diligence by calling me for a comparison quote. As a broker, I have the ability to shop multiple FHA lenders as I do traditional bank loans.
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