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How FHA Mortgages Can Protect Subprime Borrowers

by Peter G. Miller
July 19th, 2007

There seems to be no shortage of foreclosure stories, and that’s a shame because some could surely be avoided by switiching to FHA mortgage financing before the first payment is missed.

What can the FHA do? By switching to an FHA loan borrowers are effectively restructuring their debt.

How?

As HUD Secretary Alphonso Jackson has <a href=”http://www.hud.gov/news/speeches/2007-06-25a.cfm\”>explained, the FHA has helped “tens of thousands of homeowners. They were able to refinance into safer, federally-insured mortgages. Our lenders’ foreclosure rate of 1.3 percent is half the subprime average. FHA and its lenders actively work with people who are running into financial difficulty. They do this by extending their loans terms, temporarily reducing their payments, or making a partial claim through the FHA insurance fund.”

If you know someone who faces rising monthly payments, have them look into FHA financing. It may not be a perfect solution to everyone’s mortgage problems, but plainly a lot of borrowers can benefit.

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This entry was posted on Thursday, July 19th, 2007 at 2:10 am and is filed under . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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