Government loans are mortgage loans that are insured or guaranteed by the federal government. These loans are designed to aid home buyers who meet mortgage criterion that allow them to get into a home whether with a lower down payment , a lower interest rate and/or with a lower reputation rating.
In many instances consumers seek government loans because they do not qualify for a approved loan.A approved loan is simply any loan that is not a Va loan, Fha loan, Rhs loan, state or local government loan.
The following three federal agencies supply government loans. Also, the homes purchased must meet inescapable standards to apply.
U.S. Department of Veterans Affairs (Va) Loans
- Qualified forces veterans are able to buy a home under 3,000 with no down payment.
Federal Housing management (Fha) Loans
- Fha does not supply home loans.
- Fha provides the mortgage lender guarnatee that will compensate the lender for any losses in case of default on the loan
- Very low down payment on your home. (between 3-5% based on the Fha estimation value)
- Maximum loan limit depends on the average cost of living in your local area
- Flexibility in calculating household wage to payment ratios
Rural Housing Services (Rhs)
- Rhs does not supply mortgages, it simply guarantees mortgage loans made to rural residents
- Low interest rate loans with no down payment to low to moderate wage rural residents
- Loans have lower closing costs than with approved loans
State and Local Loan Programs
- special programs ready for first-time home buyers.
- Loan offers first-time home buyers with low down payments or lowered interest rates if definite wage guidelines are met
- Certain state or local agencies supply assistance with down payments and closing cost
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