|
The Federal Housing Administration was established to encourage
home ownership throughout the country with the belief that
home ownership increases the stability of a community. Prior
to the creation of the FHA, large down payments were required
to secure a mortgage loan. At present, a minimum of 3% investment
is required by the borrower for the purchase of a home. As
an incentive to investors who purchase loans, FHA insures
the loan against default, should the borrower fail to repay.
FHA guidelines also allow for greater flexibility with regards
to credit history and qualifying ratios.
Indiana FHA program opens up opportunities that conventional
mortgages do not offer:
- Expanded Debt Ratios to 29%/41%
- Non-traditional credit history is considered
- Expanded credit criteria.
- All of the down payment may be gifted
- Seller may contribute up to 6% toward the closing costs.
- Non-occupant cosigners are allowed.
- 401-k loans are not counted in the debt ratios.
|
