FHA? What are the downfalls? Benefits when getting a mortgage for the first time?
- 1 decade agoFavorite Answer
FHA is the best product for the mortgagee if you qualify; its not credit driven, you can use alternative credit like cell phone, heating and electric bills. The interest is low and taxes and insurance are included in the payment.
The only downfall is that you can only mortgage two and a half times your gross yearly income, so you may find it hard to find a nice home in the price you are looking for.
My suggestion is to research the 203k program, you can build equity with it.Source(s): http://www.hud.gov/
- 1 decade ago
FHA works great for folks in the low income bracket. But, bear in mind that there are fees and such to get started plus a 5% down, minimum.
But, if you are going this direction and qualify, GOOD LUCK!!!
The number one benefit of having a home for the first time is that you start buiding wealth and quit giving your money away on rent. It can be a bit more expensive to own a home than to rent as you are responsible for maintenance and anything that breaks or needs replaced. But, a home of your own can be a great investment! Maybe one day, you will move up like we did and keep your old property as a rent house.
Just be sure and ask a lot of questions. Don't let anything slip by that you don't understand.