FHA Book

Let’s All Learn About… (2nd Edition)

Michael Mapes has a GREAT post on Active Rain explaining mortgage insurance and how it differs with different types of loans. Although the FHA section is rather short, it’s still beneficial. Plus, it’s important for consumers to be able to compare and contrast the different types when choosing a loan. Here’s the FHA bit:

The FHA (Federal Housing Administration) provides loans to borrowers with very low down payments. The concept is similar to conventional loans, with a few exceptions. The insurance dollars are paid to the FHA. An up-front premium is due at loan closing, and that premium may be included in the loan amount. A monthly insurance premium varies with the term of the loan and the loan-to-value ratio.