The FHA and VA loan process

Learn Important Home Loan Information

• Related Articles:
  • What is a HUD Home?
  • Guide to Buying a HUD Home
  • The FHA and VA loan process
  • Benefits of Buying a HUD home
  • Why an FHA loan?
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Both FHA and VA loans are ways in which the government helps people to secure affordable housing while helping the lenders maintain secure home loans. The Federal Housing Administration became part of the Housing and Urban Development’s Office of Housing in 1965 and helps to insure private loans by aiding potential homebuyers in receiving the amount of money and government home loan for which they qualify as well as helping lenders reduce the risk of issuing loans. The FHA provides a number of specific government home loans tailored to help individual needs. The most widely utilized loan, however, is the 203(b) fixed rate loan — very popular among first time home buyers.

FHA mortgages are insured to protect lenders in the event of a foreclosure on an FHA government home loan. FHA mortgages appeal to the borrower because of the reduced cash investment required to close on property. This is possible because the FHA is self-sustaining and does not rely on tax dollars but rather the revenue created by the mortgage insurance. FHA mortgages also have flexible payment schedules (amortization schedule). If you are unsure if an FHA government home loan is right for you, ask your lender to compare it side by side with non-FHA loans. The value of an FHA loan soon becomes apparent.

Similarly, the VA Loan stems from the 1944 GI Bill that allowed veterans to purchase homes with no down payment. VA Fixed Rate Loans give veterans the option of financing their mortgage in 15, 20, 25, or 30 year terms with a fixed rate for the duration of the loan. These loans are guaranteed by the Department of Veterans Affairs and can be used in a number of ways. In addition to purchasing a single family home, townhouse, or condominium, the loan can also be used to build or purchase and improve a home. VA loans benefit veterans of the armed services, those in active duty or the reserves, as well as their spouses, and the Department of Veterans Affairs determines eligibility. Those eligible for the loan can qualify to put zero down on a loan up to $417,000.

Regardless of whether you qualify for a FHA, VA, or other type of home loan, a good deal of information will be required to complete the loan process. It would be best to ask a loan officer for a thorough list of the required information, as it may take some time to gather. Having complete information regarding all home financing requirements will help in obtaining pre-qualified status in order to buy your foreclosed or HUD home as soon as possible.

If you qualify for one of these loans, it can facilitate the home buying process for all of the parties involved. By combining the assistance offered by a government home loan and the possibilities offered by available government foreclosures, you can be in a home of your own sooner and for less! Contact a HUD approved loan officer for more information on how these loans might benefit you and your family.

Other Articles on HUD Homes & Other Government Properties

What is a HUD Home?

HUD houses are often the perfect solution for low income housing needs... read more

Guide to Buying a HUD Home

At far lower prices than average real estate, HUD homes can be real values for first time home buyers, investors, and more... read more

The FHA and VA loan process

Both FHA and VA loans are ways in which the government helps people to secure affordable housing while helping the lenders maintain secure home loans read more

Benefits of Buying a HUD home

Aside from the obvious benefits to the lender, HUD homes present a number of opportunities and advantages to the potential homebuyer. read more

Why an FHA loan?

There are a number of home buyers who don't understand the benefits associated with asking their lender for an FHA loan... read more