FHA

A Federal Housing Administration (FHA) loan is a type of mortgage loan insured by the Federal Housing Administration, a division of the U.S. Department of Housing and Urban Development (HUD). FHA loans are designed to help lower-income and first-time homebuyers obtain financing for the purchase of a home by offering lower down payment requirements and more relaxed credit standards compared to traditional loans.

Some of the key features of FHA loans include:

Low down payment requirements: FHA loans require a down payment of only 3.5% of the purchase price of the home, making it easier for first-time homebuyers to save up for a down payment.

More relaxed credit standards: FHA loans have more relaxed credit standards compared to traditional loans, allowing borrowers with lower credit scores to qualify for financing.

Mortgage insurance: FHA loans require mortgage insurance, which protects the lender in the event of default. The cost of mortgage insurance is typically added to the monthly mortgage payment.

Fixed-rate or adjustable-rate options: FHA loans are available in both fixed-rate and adjustable-rate options, allowing borrowers to choose the type of loan that best meets their financial needs.