Thousands of Americans will consider becoming a first time home buyer during 2009 and, one of the options they may consider is an FHA loan. FHA the Federal Housing Administration, was established in 1934 with its sole purpose to provide affordable housing. Most FHA Loans are given to first time home buyers. FHA provides affordable financing options for many first time home buyers.
Those planning to apply for a new mortgage loan during 2009 with the Federal Housing Administration, will face new down payment requirements. These are going to be different from loans that were financed previously. The minimum down payment requirements for FHA loans have been 3 percent for several years, and typically included closing costs. This year down payment requirements will change to three and a half percent. Closing costs may not be included in that amount. Down payment assistance programs that were offered such as AmeriDream and Nehemia have also been phased out.
The FHA minimum down payment change for 2009 still provides the most affordable way for new home buyers to purchase their first home. Considering the first time home buyer credit of up to $7,500.00 which is available until June 30, 2009, the FHA program is still better than most programs offered.
Another key feature of an FHA loan, is that it is backed by the Federal government. This means that banks and other mortgage lenders may be more willing to extend credit. It is important to keep in mind that most alternative loans require down payments of between ten and twenty percent of the purchase price. This requirement increases if there are more than one unit in the home.
The FHA minimum down payment change for 2009 still offers the best financing method for thousands of Americans. The American dream of home-ownership is still possible through the FHA. With mortgage rates extremely low, even with the FHA minimum down payment change for 2009, millions can realize the dream of home ownership.You can learn more about FHA loans by contacting the Federal Housing Administration.