What types of interest rates are offered?
(fixed, adjustable, interest only) FHA home loans are similar to conventional loans in the respect that they offer fixed rate and variable rate purchase mortgages and interest only options, home equity loans and home equity lines of credit (HELOCs) offering flexible draw period and repayment terms. The repayment period for most FHA purchase loans is 30 years, similar to conventional loans. FHA also loans that have the potential for negative amortization where lower starting payments may not cover the interest, resulting in the unpaid interest being added to the balance. FHA rates may be a little higher than conventional mortgages, but not much unless you have credit issues. FHA Mortgage Insurance FHA home loans require a fee (1.5% of the loan amount) that must be paid at closing. This mortgage insurance insures the loan with FHA. In addition, FHA also requires an annual fee of up to 0.5% of the existing loan amount, paid in monthly installments. It is important to remember that mortgag
