Utah FHA Loans

Are you looking for a Utah FHA Loan?

Let’s begin with a little bit of history about FHA loans. The Federal Housing Administration, also known as "FHA", provides mortgage insurance on loans made by FHA approved lenders throughout the United States. FHA insures mortgages on single family and multifamily homes including manufactured homes. It is the largest insurer of mortgages in the world, insuring over 34 million properties since its inception in 1934.

What does this mean for you? A Utah FHA loan has a very low interest rate and technically no real credit score requirement. With the credit problems that have plagued the mortgage and banking industry over the last year, FHA has been a savior for many homeowners in Utah and nationwide who were struggling to make payments on their adjustable rate mortgages. Some of those borrowers who had adjustable rate, sub-prime loan, might have easily qualified for an FHA fixed rate loan.

When searching for a new Utah mortgage loan, make sure your broker is able to provide an FHA loan as an option. FHA loans require an up front mortgage insurance premium that equals 1.5% of the loan amount. On a purchase or refinance, that premium can be wrapped up into the loan as financed closing costs. FHA loans typically require 3% down on a purchase and allow the borrower to finance up to 95% of the property’s value in a refinance. The wonderful thing about an FHA refinance is that there is no increase in the interest rate if you choose to take cash out of the property. This is unlike conventional mortgages that will almost always have an increase to the rate if you take cash out!

An FHA loan requires full documentation of income and also requires that the borrower have 12 months of timely payments on their current mortgage (late payments evaluated on a case by case basis), or proof of good rental history for a first time home buyer.

FHA loans have limits to the amount you can borrow. In high cost areas such as Salt Lake City, the FHA loan limit for a single family residence is $729,750! If you think an FHA loan might be right for you, contact a UtahMortgageNetwork mortgage broker to find out how low FHA rates are today. An FHA loan might just be the right Utah mortgage for you.