You, Too Can Qualify For An FHA Mortgage

A long time ago, in a land right underneath our feet, there was such a thing as the 3-5 year mortgage and balloon payments were common - wonder when that was - it all started right before the Great Depression in 1929.  Foreclosures were rampant and there were no other refinancing options for the average homeowner.


The National Housing Act was passed in 1934 to stem the bloodletting. The Federal Housing Administration (FHA) was created to regulate interest rates and mortgage terms.  They insured mortgage loans by purchasing outstanding mortgages, allowing banks to make more loans without depleting the bank's capital.  When you think about it, banks have been on welfare for years.
This allowed more people to purchase homes, and after WWII home ownership flourished.  Since it's inception, the FHA has insured over 30 million homes. Most of the urban home ownership you see is the result of the Federal Housing Authority.

The recent failure of "exotic" mortgage packages has brought things full circle and the FHA is back in vogue. It offers a safe mortgage package that won't blow up in your face or create a need to pay exorbitant mortgage payments.


Here are the general guidelines:

• Mortgage payments should be no more than 31% of your gross monthly income
• Monthly obligations overall should be no more than 43% of your gross monthly income
• Credit scores above 620 are preferred, but a score of less than that amount will be considered
• Bankruptcy filers are also eligible for FHA loans
• Federal tax debts and Student loans delinquencies will disqualify the prospective lender - so please make arrangements

Want more information - please give me a call 312-498-1138!