What is an FHA Loan????

FHA stands for Federal Housing Administration:
According to www.HUD.gov website the official definition:

The Federal Housing Administration, generally known as "FHA", provides mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. FHA insures mortgages on single family and multifamily homes including manufactured homes and hospitals. It is the largest insurer of mortgages in the world, insuring over 34 million properties since its inception in 1934.

hmm the easiest explanation would be it is one of the most popular loan used by anyone who is trying to buy a house for the loan amount under $271,000. Loan is guaranteed by FHA underwritten by various either Banks, Credit Unions, Investments etc. Rule of thumb with FHA is you need 3.5% as down payment and 3.5%-4.0% as closing cost.
Closing cost most of the time with FHA loans usually is negotiated with the sellers. So you can own a house in this Buyers market with as little as 6.5%. Most of the time you will come across teasers like FHA loan you can buy it for as little as 3.5% that is true as long as cost of underwriting a loan and all the fees can be rolled into the loan and it does not exceed your max buying power or paid by the seller. But it is still an awesome tool for anyone want to buy a home specially first time home buyers.

In city of Houston there are other programs also which provide down payments assistance but all those programs have requirement which need to be followed. Just FYI.



I am Realtor in Houston and surrounding area and if you have any need or question regarding Real Estate please contact me at the following.

Sam Chaudhry 
Broker Associate. 
832-419-4700 
Sam@samcp.com
Remax Top 200 Broker

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Remax, Re/Max. Houston Texas. 
Houston Area Homes for Sale. 

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