Thousands of people have turned to Gem Home Loans for FHA loans in Royal Oak, Michigan and other areas of the state. The reason is they know they can trust us. You may have run into other lenders in the past that tried to convince you to go in a certain direction, whether you really wanted to or not. They just wanted your money. They could not have cared less about your best interests. We don’t play those kinds of games. When we recommend a loan program, we only do so after careful consideration of your financial picture – now and in the future.
The Advantages and Drawbacks of FHA Loans
An FHA loan isn’t for everyone. It might just help you get in the home of your dreams, but it might not be the best alternative. We want you to be a well-informed homebuyer. To that end, here are some of the reasons you might want to pursue this type of loan, as well as other reasons why you might be better off with another loan program.
FHA Loan Advantages
- The down payment – You won’t have to put down 20 percent of the price of the home with an FHA loan – it would be more like 3.5 percent. There’s even a chance you could get a home with $0 down. You could be “gifted” the down payment by a friend, someone in your family, or even a charity. Conventional loans either don’t allow gifting at all, or the place strict limitations on down payment gifting.
- Your credit – If you have a lower credit score, you might still be able to qualify for an FHA loan. While you’d need a score no lower than 620 to obtain a conventional loan, you could be approved with a score of between 580-619. If, however, your score is lower than 580, you still may qualify. But you should expect a down payment of 10 percent rather than 3.5 percent.
- Flexibility – You don’t have to buy what would be considered a “traditional” house in order to get an FHA loan. You may also qualify if you’re looking for a manufactured home or a condo.
FHA Loan Drawbacks
- The home will have to be your main residence – You can’t get an FHA loan if you’re looking for a vacation home.
- You’ll need to pay insurance payments – You’ll need to pay an insurance premium each month. This will last until you’ve built 20 percent equity.
- No “flipping” – An FHA loan is only for structures that are sound, and meet health and safety standards. If you’re planning to buy a distressed property so you can fix it up and sell it, a practice known as “flipping,” you’ll have to look for another kind of loan.
Let Us Help
The process of getting FHA loans in Royal Oak, Michigan can be complex. It can also be filled with stress and confusion. Let a Gem Home Loans expert take away all of those negative feelings. We’re passionate about helping make the process of buying a home as smooth and simple as possible. We’ve earned a lot of business by taking this approach, and we welcome the chance to prove ourselves to you as well. Please call (248) 780-1030 or contact us online to learn more.