The FHA does not make loans, but rather insures the lender against loss that may occur if the property is foreclosed upon and the sale does not cover the amount owed. The FHA insures lenders against loss from making loans that have a higher risk of default than the lender would accept without the insurance. For purposes of simplicity and because of its common terminology, these FHA-insured loans are referred to as FHA loans.
- What distinguishes FHA-insured reverse mortgages from non-FHA-insured reverse mortgages?
- What is a loan to value ratio and how does a loan to value ratio determine the size of my mortgage loan?
- Who can qualify for an FHA mortgage loan?
- What are the favorable terms of an FHA mortgage loan?
- What is the major advantage of an FHA loan?