► Are FHA loans good?
FHA loans are very good! The down payment requirement on
an FHA home loan is only 3.5% and the seller can pay a large
percentage of the buyer’s closing costs. The FHA loan allows
for down payment and closing cost gift money. FHA loans are
a very good way to finance a home.
► Are FHA loans only for first time
No. FHA home loans are available to non-first time home
buyers and first time home buyers.
► Can FHA down payment be a gift?
The FHA permits the down payment to be "gifted"
from eligible donors.
► Can FHA loans be refinanced?
The Federal Housing Administration does not place any restrictions
on refinancing FHA loans. In fact, the FHA offers a great
refinance program for homeowners who want to reduce their
interest rate or term. Read
► Can the lender pay my closing costs?
Lenders may pay a borrower’s closing costs, and/or prepaid
items by “premium pricing.” Closing costs paid in this
manner do not need to be
included as part of the seller contribution limitation.
FHA Underwriting Manual
► Can you refinance a FHA loan to
a conventional loan?
FHA loans may be refinanced to a
conventional loan without restriction.
► Can you remove pmi from an FHA
Unfortunately, the FHA does not allow the pmi (mip) to be
removed. It does not matter if you made a down payment of
20% or more or if you have paid down the mortgage by 20%
or more. The pmi/mip cannot be removed.
► Can I buy foreclosure with FHA
Home buyers can use an FHA loan to buy a foreclosure providing
that the foreclosed home meets the FHA appraisal guidelines.
If the foreclosure is a HUD home (an FHA foreclosure), the
home must carry the "insurable" label. This means
that the FHA will permit an FHA on the
► Can the down payment on FHA be
Yes, provided that the donor(s) meet the FHA guidelines
and will sign a gift letter.
► Do FHA loans require pmi?
All FHA loans require pmi (also known as mip - monthly mortgage
insurance); and, the monthly FHA pmi cannot be removed regardless
of down payment or mortgage balance reduction.
► Do FHA loans require mortgage insurance?
All FHA loans require an upfront mortgage insurance payment
and a monthly pmi/mip monthly payment.
► Does FHA require termite inspection?
Termite (or pest) inspection is no longer required by the
FHA unless there is evidence of active infestation or it
is required by the state or local jurisdiction, is customary
to the area, or at the lender’s discretion. Mortgagee Letter
HID Questions & Answers
► Is there an FHA inspection?
The FHA does not require a home inspection, although, the
FHA strongly encourages all home buyers to obtain a home
inspection prior to closing. The FHA feels so strongly about
home inspections that the lender will ask you to sign a
form to inform you about the importance of a home inspection.
For Your Protection: Get a Home Inspection.pdf