Federal Government Loans – FHA Mortgages
Posted by Manju in Business And Finance
Federal Government Loans (FHA, VA) are well known for their liberal qualification requirements. With an FHA mortgage a borrower can have a moderate income, less money for the down payment, a foreclosure or bankruptcy in their credit record (of course at least 3 and 2 years old respectively) and still qualify for a mortgage loan.
FHA mortgages are obtained through private mortgage lenders that are FHA approved. The whole mortgage process is set under the FHA guidelines: the mortgage documentation processing, the loan approval, the mortgage closing and the mortgage insurance. The latter is done through a mortgage insurance premium (MIP) that is divided into two parts: an upfront MIP (financed into the loan amount) and a periodic premium (escrowed into the monthly payment).