We have seen a large number of people really benefit from the FHA loan program, and what is most interesting is many of them have just recently been turned down for more traditional conventional loans
Livonia, Mich. (PRWEB) November 29, 2007
It's no wonder many American homeowners say they're worried and confused by the doom and gloom coming from the nation's housing industry. The news is filled with reports of declining home values, resetting adjustable-rate mortgages and people feeling the pinch of tightened credit. However, there is a bright spot in all the bad news, and it's been around since the 1930s - the Federal Housing Administration (FHA) loan.
Historically used by consumers to purchase their first home because of its low down payment requirements and competitive rates, FHA loans are making a comeback and quickly gaining prominence among those looking to refinance as well.
"We have seen a large number of people really benefit from the FHA loan program, and what is most interesting is many of them have just recently been turned down for more traditional conventional loans," said Bob Walters, Chief Economist for Quicken Loans, one of the nation's largest mortgage lenders. "This program isn't the answer for everyone, but we have found that it can be a very viable option for many people."
According to Walters, FHA loans are being used by consumers for cash-out refinancings, or to consolidate debt up to 95 percent of the home's value - moves that are extremely difficult and often not economically practical to make with current conventional lending guidelines.
"Through the first half of 2007, homeowners had no problem making their mortgages work for them. However, since that time, tighter lending guidelines have resulted in many loan programs being taken off the table. Fortunately, FHA loans can fill some of the void. When used responsibly, FHA loans can provide much-needed relief. Everyday, we help clients purchase homes, pay off medical expenses, eliminate high-interest credit card debt and generally improve their financial position through the FHA program," Walters added.
Consumers are also finding that in some instances, FHA loans can close very quickly, in less than 14 business days in some cases.
"The bottom line is that FHA loans are an option for many folks, but not for everyone. It is very important that every homeowner consult with a reputable lender who will listen to their needs and goals, and then suggest the best mortgage for them. In some cases it could be an FHA loan, and in others it may be a conventional fixed or adjustable rate mortgage. What is important is that the loan actually works for the consumer and puts them in the best possible financial position," Walters concluded.
For more information about FHA loans, visit http://www.quickenloans.com/fha.