How Can HUD and the FHA Help to Become a Homeowner
You want to own your own home, but buying a home can be difficult. There are agencies that can help. The United States Department of Housing and Urban Development (HUD) has joined forces with the Federal Housing Administration (FHA) to make buying a house easier for many Americans. Here is how these agencies can help you become a homeowner.
With HUD and FHA, the down payment is less for your new home. Many loan companies require a 20% down payment. HUD and FHA requirements are less. Depending on the price of the home, you may not have any down payment at all or the down payment may be less than $3000.
HUD and FHA can also guarantee you lower interest rates and help to make monthly payments more affordable.
HUD owns many single and multi-family homes throughout the country. They are able to sell these homes at an affordable price through FHA loans.
Your family income will determine if you are eligible to apply for HUD housing or FHA loans. The organizations focus on the middle and lower class incomes.
HUD not only provides affordable housing, but it also protects home buying consumers through education, creating and implementing Fair Housing Laws and other housing rehabilitation services.
Since 1934, the FHA has helped over 26 million Americans purchase homes in the United States.
Many times, the FHA is able to create home loans that are the same as your monthly rent, costing you no more to own a home.
The FHA does not focus on your credit rating and/or high paying job. It is able to use other qualifications, such as bills being paid in a timely manner, a steady income, and your debt to income ratio. FHA does not require a minimum monthly salary for qualification purposes.
If you want to get an FHA loan, you must show proof that the home you are purchasing will be your primary residence. The FHA does not provide loans for second homes, vacation homes or rental properties.
The FHA is also not as concerned about the type of income; it is more concerned with the steadiness and consistency of income. If you receive a monthly payment for social security, alimony, child support or structured settlement, then you can use this steady income as part of your total income. This is not true for conventional loans, only loans through the FHA.