If you are not a home owner and are tired of renting homes, then FHA loans is the right solution for you. FHA loans can help you to get a home of your own. The FHA mortgage for new home does not require high credit score and even with a credit as low as 620, you can get a new home. The FHA loans will also be helpful if you are facing the problems like bankruptcy and foreclosure. Two years after you have been declared bankrupt, you can ask FHA for the home mortgage if your credit has become acceptable. You can also ask FHA for loan if the foreclosure has been older than three years. Remember that you will still find it hard to get a conventional loan after improving the credit if you have faced bankruptcy or foreclosure in past.

The FHA loans have other advantages as well. One of the top advantages of FHA loans is the inclusion of home insurance. You will be paying the premium as a part of the monthly loan installment. Not only this but such insurance has lower rates than any other mortgage insurance company. This way the FHA loans suit to the first time home buyers. They make it easy for them to manage the payments with one single installment every month and with better rates.

FHA loans have faced some problems in the past with its loan limits. In the high priced areas, the FHA loan limits would make it hard for all the people to get loan. The situation improved in the early 90’s and the limit was raised to $625,500. the year 2009 has been a real good year for FHA as it has seen a much needed improvement in the loan limit. The new bill which has been passed now has raised the limit to $729750 hence allowing more people to get loans from FHA.

However, with all the foreclosures on the market today, we really need to sell these to willing buyers to help stabilize the real estate market.  Over the last 6 months, 90% of our business came from first time home buyers utilizing DPA (or DAP) from the sellers who otherwise couldn’t buy a house at this time.

These buyers have good credit and make good money to pay their monthly mortgage, however, saving for a down payment just hasn’t been possible.  Thet=y deserve to own a home and enjoy the benefits of owning rather than renting.

I am really curious to see the number of home loan applications over the next few months to confirm that this ban on these programs has truly affected our real estate market in the opposite way.  Only time will tell.

In some cities and communities there are still organizations with programs that offer down payment assistance to qualified borrowers , so look to see what may be available in your town.