The FHA was supposed to lead the U.S. mortgage industry out of crisis, but rising defaults are prompting the agency to tighten up its lending standards.
FHA Loans Articles
Although they fell from favor (and nearly off the radar) during the last real estate run-up, FHA and VA mortgage products are now grabbing powerful market share. Government-backed loans currently account for about a third of all mortgage applications in the U.S.
Companies offering private mortgage insurance (PMI) are suffering catastrophic losses due to an avalanche of foreclosure-related claims. But the FHA, which offers HUD-backed FHA loan guarantee reassurance to banks and investors, is quickly capturing that lost PMI market share.
Jumbo mortgages are larger-than-normal mortgages that are used to pay for, or refinance, higher-cost homes. The Federal Housing Administration (FHA) began insuring these big loans this year, at least on a temporary basis, as part of the government's much-touted economic stimulus package.
With the country's economy and housing crisis currently on everyone's mind, owning your own home may not seem like a realistic venture right now. But home ownership shouldn't be out of anyone's reach, including lower income families and first-time buyers. Before dashing out to your local lender, however, educating yourself on what government backed loans and programs are available is essential to your long-term homeownership success.