About Government Refinance and Home Purchase Programs

Information and Updates on Government Mortgage Programs
Filed under Government Mortgage Financing Programs News

Annette West recently published this interesting article on FHASecure over at the Las Cruces Sun-News:

FHA is a quasi-private agency regulated by the government whose purpose is to help low and moderate income Americans become homeowners. FHA does not make loans — it works with lenders to make it easier for you to get a loan.

The FHA has several popular programs. Using the 203(b) mortgage insurance program, you need only make a 3 percent down payment instead of 20 percent to purchase or refinance an owner-occupied residence.

What’s the catch?

You have to pay an upfront mortgage insurance premium of 1.5 percent of the original loan amount, which may be included in the loan amount. You also pay a monthly mortgage insurance premium of 0.5 percent of the original loan amount. You do that until you have a 78 percent loan-to-value ratio, or have built 22 percent equity in the property.

Now the FHA is adding a new refinancing program called FHASecure. Designed for people with good credit scores who have been paying their mortgage on time, the program is to help borrowers refinance their mortgage. This is expected to help an estimated 240,000 families avoid foreclosure.

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