Despite changes in the FHA guidelines that increase the cost of obtaining an FHA insured loan, borrowers across the country are still using the government program to do more than just purchase a new home.   HUD approved lenders also offer the following mortgage programs:

Rehabilitation Loans (203k) – The FHA 203k loan provides money for borrowers to rehabilitate an existing home, or to purchase a home and immediately make improvements to it such as bringing the home up to current safety codes, adding handicap accessible features, or replacing roofs, windows and doors.  The loan is different than most rehab loans in that the 203k program offers money for purchase and rehab all in one loan.  The borrower doesn’t need a second construction loan or line of credit for the repairs.

Energy Efficient Mortgages (EEM) – The government rewards residents who want to lower their utility bills and make their homes more energy efficient by letting borrowers add the cost of the energy efficient improvements and their installation to the purchase or refinance loan amount.  The improvements can be made during a home’s construction, after the purchase of a new home, or in the rehabilitation of an existing home.  Typical improvements include installing solar panels,insulating attics, installing new doors and windows, and replacing or adding a furnace or cooling system. Other allowable improvements are found on Energy Star’s website.

Disaster Recovery Loans (203h) – The FHA 203h loan makes mortgages available to residents in presidentially declared disaster areas, like those areas of the country ravaged by major floods, hurricanes and earth quakes.  The loan program allows the borrower to get up to 100% of the costs to rebuild their home or to construct a new one.  To find out if your area has been included on the presidentially declared disaster list, visit this link.

An FHA insured loan is a great loan options for borrowers with less than perfect credit and cash down payments as little as 3.5 % of the purchase price of the home. For more information FHA insured loans, check out LendingTree’s FHA Loans information page.

Related Posts:

• Office of Sustainable Housing and Communities Aims to Reduce Cost of Home Ownership
• Disaster Recovery Loans Can Help You Rebuild Your Home
• Who is the Ideal Candidate for an FHA Loan?
• New Residential Construction Data for February 2010
• Government Raising Borrowing Costs for FHA Insured Loans