You are purchasing your first home.



You don't have much money for a down payment.

You want to keep the payments on your monthly mortgage as low as possible.

You are worried about the payments rising in the future.

You fear that you may not qualify for a standard mortgage or loan.

You have less than perfect, or even bad, credit.

If any of the above describe you and your situation, FHA loans are probably right for you. FHA loans offer security and benefits that you won't get from a standard mortgage or loan. Some of the benefits offered by FHA loans that aren't available from standard loans include:

Low interest rates ? Because the United States federal government insures the loan for the lender giving you the money, these insured loans may have lower and more competitive interest rates than standard loans.

Down payments are smaller ? Standard loan down payments are between five and 10 per cent, whereas FHA insured loans require only three per cent down payment. Also, the money for your down payment can come as a gift from an employer, family member or charitable organization where standard loans do not allow this.

Qualifying for the loan is easier ? Because your mortgage will be insured by the US government through the FHA loan program, lenders are likely to be more willing to give you a loan and make it easier for you to qualify. This includes people who have less than perfect credit.

You can have less than perfect credit ? One of the main requirements from lenders offering you a standard mortgage is that you have a good credit rating. The FHA insured loans don't require you to have perfect credit ? you can have a history of credit issues, including bankruptcy and still qualify for an FHA loan. For people in situations with past credit issues, standard loans usually are not approved.

Help through the hard times to keep your home ? The FHA helps people keep their homes and has many options available to help you avoid foreclosure should you encounter hard times. This insurance and protection helps many Americans avoid foreclosure and losing their homes.

FHA can help you purchase a manufactured or mobile home ? It can be quite difficult to get a standard loan for a manufactured or mobile home, regardless of its condition or location. FHA loans can apply to mobile and manufactured homes, providing they are on a solid, permanent foundation ? this includes mobile homes that are located, or will be located, in mobile home parks. Having the FHA loan backing can be the ticket to purchasing a mobile or manufactured home in the United States.

Even though the FHA insures loans and this usually means that you are getting a better interest rate, it's still important to compare mortgage loans to ensure you're getting the best deal on your interest rate. Different lenders will offer different rates, so be sure that you get at least three quotes from FHA-approved lenders to compare.