The Advantages of FHA verses Conventional Loans in Todays Market
August 7th, 2008 categories: Julie's Mortgage Tips
Do to the current crisis in the conventional loan market Fannie Mae and Freddie Mac have raised the cost of making loans. An adverse market fee has been added to all loans and has recently doubled. Additional fees or “hits” have been added for various reasons:
- Credit scores below 720
- No credit scores
- 2nd homes
- Cash out refinances
-
Private mortgages insurance rates have been raised
An FHA loans has no income limits and can be used by any qualified buyer.
Some FHA loan benefits are:
- Low down payments 3% (your down payment can be 100% gift)
- Will accept a credit score in the 600’s
- Do not require cash reserves
- PMI for FHA is reasonably priced
- FHA will work with a person with no credit score if they can provide 4 pieces of alternative credit.
Loan limits have been raised .
These are the new loan limits for FHA.
These were some shots in Jackson Square this past weekend. You can reall take in a lot with a mile of this historic area in New Orleans.
FHA loans have always been a great option for people struggling to get financing. Those fee raises are going to make it a little bit harder for some.