FHA mortgages make it easier for people to buy a home who do not have the funds for a large down payment.
Although there are many advantages of an FHA mortgage, it also has its disadvantages.
Advantages of an FHA Home Loan
FHA Mortgages are very easy to acquire for most first-time homebuyers, even for those with less than perfect credit. If you have experienced a bankruptcy or foreclosure, you may still be eligible for an FHA loan.
FHA home loans are also assumable, which is another advantage. This feature can benefit you by increasing the number of potential buyers of your home, when it comes time to sell.
Disadvantages of an FHA Home Loan
Of course, the benefits of an FHA home loan come at a cost. Because the federal government is insuring your loan against potential default while also allowing a low down payment, you will be required to pay two types of insurance in addition to the monthly payment.
To learn more about the advantages and disadvantages of FHA mortgages, and the insurance premiums require by this type of home loan, take a look at our FHA Home Mortgage Guide.