FHA Loans

From America’s Mortgage Resource with offices in Metairie, New Orleans, Mandeville & Baton Rouge

Are you in the market for an FHA loan in the metro New Orleans area? If so, you’ve come to the right place!

America’s Mortgage Resource can help you get started in the process of obtaining an FHA-backed loan.

Introduction to FHA Loans

The Federal Housing Administration (FHA) is a federal government agency that runs a wide spectrum of programs that assist people with home ownership. FHA loans are home loans backed by the FHA that are especially helpful for borrowers with limited financial means. These types of loans are insured by the FHA against default. As a result, the FHA programs make loans available to borrowers who might not otherwise quality through conventional loan programs.

First-time homebuyers are ideal candidates for FHA loans, as the program allows for a smaller down payment than many traditional loans. Also, individuals with credit issues and potentially lower credit scores may also be a good fit for an FHA loan as the credit guidelines for this program are more flexible than traditional mortgage guidelines allow.

There are a number of benefits to obtaining FHA loans. These include:

  • Smaller down payment and closing costs
  • Down payment can include a monetary gift from a charitable organization or other sources (family, employer, etc.)
  • No minimum credit score required (some lenders will require a credit score of at least 580). If you do not have a credit history, factors such as history of payments for rent, utility bills, auto insurance, etc. can be considered
  • No prepayment penalty
  • In some cases, funding for home improvement projects
  • Potential leniency during financial hardship

A Few Important Details About FHA Loans

In order to fund an FHA-backed loan, a small ongoing fee with monthly payments and an upfront mortgage insurance premium (MIP) are required. These fees are usually minimal. For example, the upfront MIP is typically 1 percent. In the unlikely case the borrower defaults on the loan, the FHA uses these fees to pay off the remaining mortgage.

Of course, before you begin the process of buying a home or refinancing a home, speak to a mortgage loan professional to find out which program makes the most sense for you. America’s Mortgage Resource has offices in Metairie, New Orleans, Mandeville and Baton Rouge where our lending professionals are standing by to give you a free quote and to help you to determine if FHA, or any other type of loan might be best for your particular situation.