What are FHA Home Loans?
FHA (Federal Housing Administration) backed loans are ideal for first-time home buyers and those low-to-moderate-income borrowers. Loans are insured by the FHA. Down payments may be as little as 3.5% and 100% of the down payment funds can be from a gift. There are also several other options for the source of funds needed for closing. The seller can contribute up to 6% towards closing costs, prepaid cost and points. No cash reserves are required for loan approval. FHA loans can be fixed or adjustable rate. (See Conventional Loan Programs)