Home ownership is one of the most dreamt of goals a person can ever have in their natural lifetime. This aspiration is also a reality even those who stand to inherit a home from their own family, since owning a home through one's own efforts is sure to serve as a crowning achievement of all their hard work, not to mention it could also very well symbolize their ability to achieve a level of success that afforded them the means to own a home of their own. This, however, is a rarity nowadays, considering the fact that the economic situation prevalent in the United States and all over the world as well, is quite restrictive when it comes to significant expenditures, such as purchasing a new home.
Not only are inflations rates astronomical, but the constant threat of company closure is a possibility that hangs almost on all businesses operating today. This fact further impedes any plans to acquire a new home, since payment of the house itself, even if the down payment has already been settled, will become increasingly difficult should a person suddenly find themselves unemployed. It is in times that these that any form of legitimate and manageable aid would be best appreciated, especially if it allows a person to secure the home they have always dreamt of. All the more reason to look to pertinent knowledge and information that could help in achieving the goal of owning a home, such as information on FHA mortgage loan, an increasingly popular program for those seeking a new home through a refinancing process.
The Federal Housing Administration provides mortgage insurance on the loan made by a lender, primarily those which are FHA-accredited. The FHA insures the loans made on single family and multi-family homes in the US and in its surrounding territories, effectively making it the largest insurer of residential mortgages in operation.
But what is mortgage insurance?
Mortgage insurance is an insurance policy that effectively protects lenders against the losses that may result from non-payment of home mortgages. These loans typically require mortgage insurance for borrowers that make a down payment of less than 20 percent. This insurance is usually charged to the homeowner at the rate of .5 percent each month per year of the total loan amount, and it usually also charges an initial mortgage insurance premium of at least 1.5 %.
So how does this help you get a home?
To put it simply, a refinance through FHA is much simpler to qualify for, since it was made expressly for the purpose of helping people, rather than just making more money off them. The loan itself is guaranteed by the US government, and because it is, this makes the loan all the more appealing to potential lenders, since they are also sure to be able to collect regardless of the circumstances surrounding the loan itself. Add to this the fact that the FHA streamline refinance program is structured to cost less and is more amicable to giving an amnesty regarding early delinquencies with payment and credit.
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