There is nothing that should be taken lightly about buying a home in Sacramento, CA. Buying a home is one of the largest investments that most people will ever make in their lives. It requires being very careful, especially in a climate of rising interest rates, that can make paying mortgages even more challenging.
One of the things that home buyers should be looking into in Sacramento, CA is the type of mortgage to apply for. There are a lot of different mortgages offered by different banks and private lenders. But one of the more reliable mortgages, especially for first-time buyers, comes from the Federal Housing Administration.
Working with You
The FHA was created in order to help Americans own homes, and is designed to be a friendlier, more lenient type of mortgage than that typically offered by more risk-averse banks and private lenders. However, FHA mortgages are now offered through many banks and lenders that are approved as FHA partners.
One of the biggest benefits of going with an FHA mortgage is just how friendly it is for people that are buying a home for the very first time. It is these people, in particular, that FHA mortgages were crafted for, as well as those people in middle- or lower-income tax brackets. In other words, an FHA mortgage is not there to service rich Americans, but everyone else.
Lower Credit Scores
One big difference between other mortgages and the FHA mortgage is that an FHA mortgage has a lower barrier of entry for the credit score. Credit Scores are usually drawn from a FICO score, or Fair Isaac Corporation. This is one of the biggest companies in America responsible for tracking down the credit history of individual Americans and assigning a “report card score” on how well they are doing.
Lower Down Payment
The FHA mortgage is also often much more forgiving for down payments. The reason this is possible is because of mortgage insurance.
Borrowers pay an additional insurance premium because they are getting a mortgage with a much lower down payment. But, with diligence, once a certain amount of the total property value has been paid off,
the insurance premium requirement can be reviewed, altered, or even negated entirely, depending on the circumstances.
Get an FHA Loan
If the FHA mortgage sounds like something that might work for you here in Sacramento, CA, then, contact us. We can discuss your home-owning plans, go over your finances and see which mortgage options, including the FHA mortgage, will best suit your needs.
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