What are the Typical Rates and Terms for FHA Loans?
• As of January 1, 2009, Borrowers can finance 96.5% of the purchase price, which equates to a 3.5% downpayment. In some instances, when combined with other types of loans, the down payment can be zero. • Some or all of the downpayment, closing costs or pre-paids can be money from a family member, employer or charitable organization. Documentation and trailing of funds will be required. • FHA also allows for a “family loan”- if your relative is not gifting, but loaning funds– with payments being counted in determining qualifying ratios. • 401K loans are an acceptable source for all funds needed, and no payment is counted in the qualifying ratios. • There is little or no adjustment to the interest rate for an FHA loan, as the rates vary within .125 percent of a conventional loan. • As of January 1, 2009, the maximum mortgage limit in high-cost areas is 115% of local median prices, not to exceed $625,500. Click here to find the FHA Mortgage limits for your area. • Mortgage insurance is
