Did you know that FHA loan has various benefits other than serving one? Yes, there are plenty of things that you can do with this home mortgage. When you have managed to keep up decent credit score and paid bills on time, you are hopeful about your loan application. However, it is better to stay updated with the available options once you are eligible.
Qualifying for FHA loan is not a matter of headache. If you have at least 580 credit score, you can avail 3.5% down payment. In any case, your credit score is down to 500, you can still get 10% down payment. This refers to the fact that FHA government home loans bad credit can actually cater to people with little savings or flawed financial habits. As you can easily pass the loan requirements, you need the possible ways to utilize the mortgage.
Here, we have mentioned a few options that only FHA mortgage opens for you. To know more, take a look below.
Purchasing Your First Home
FHA loan is not exactly meant for a single type of buyer living in the same location. The loan program is more lenient than conventional or other house mortgages. Additionally, first-time home-buyers can take advantage of the loan down payment and relaxed credit requirements. There is a chance that the private lender can offer first-time buyer incentive because the guidelines are not too rigid. Now, it is to remember that the Federal House Administration itself does not provide the first-time home-buyer incentive.
Refinancing Current Loan
FHA 203(K) rehab loan can be an option for refinancing a present mortgage and let you pay for home improvements and renovations. For instance, you can make the whole house more energy-efficient. At this time, you can utilize FHA Energy Efficient mortgage option for getting more funds. In this way, the energy-efficient upgrades and improvements can be done. Apart from this, when there is a chance to refinance to get lower monthly interest rates, you should refinance it. Streamline loans do not call for FHA requirement or FHA-approved credit check.
Getting a Second Home
If you are applying for the second time to get a new property, your application has a high chance to get accepted. In the meantime, you need to remember that the mortgage for the property needs to be for a primary residence. Hence, you cannot opt for the loan for a timeshare, temporary occupancy, or vacation home. During the approval, the borrower needs to prove that the new purchase is for primary residence only. The loan even allows the purchase of four living units only when the borrower is ready to rent out the other vacant units.
Therefore, you are now exposed to all the possible bright sides of an FHA loan. It is an ideal choice for anyone looking for low down payment percent while suffering from less than perfect credit score. In the end, you must consult with the lenders to find a house mortgage product and use its exclusive benefits.