FHA Home Loans
FHA does not actually make mortgages, rather they insure them assuming the loan meets their guidelines. With a conventional loan, if you put less than 20% down you pay Private Mortgage Insurance or PMI. With an FHA mortgage, the government replaces the private insurer and FHA actually insures the mortgage that the lender makes. Think of FHA as government mortgage insurance.
Many people mistakenly think that FHA is a first-time buyer product. While it might be true that many first-time buyers utilize FHA financing, you don’t need to be a first-time buyer to take advantage of an FHA mortgage.
FHA has a minimum down payment requirement of 3.5% and their mortgage insurance premiums are not impacted by credit score. FHA also imposes a maximum loan amount, which currently stands at $510,400 in the Denver area. FHA allows for lower credit scores compared to its conventional counterparts and FHA allows faster reentry to the mortgage market for people who have experienced financial difficulties such as bankruptcy, foreclosure or short sale.
FHA also has a fantastic renovation product known as a 203K mortgage, as well as a fantastic streamline refinance program. FHA also has products for manufactured housing and condominiums.