FHA mortgage loans are popular among the first time home buyers due to variety of reasons.  As most of the private lenders demand stricter mortgage requirements, people with low credit are getting attracted towards FHA loans.  Most of the low-to-middle income group families prefer FHA home loans.

Fact about FHA Loans

The FHA loans can be used for purchase of new home or refinancing of the principal residence. Here you need to understand one important thing about FHA Loans that is Federal Housing Administration (FHA) does not fund a loan, instead it insures a loan. The mortgage loan is actually funded by lending institutions such as a bank, or a lending company or loan association.  To avail FHA loan, borrowers are required to pay upfront for MIP that is Mortgage Insurance Premium of about 1.5% and small monthly mortgage premium. Borrowers can calculate the mortgage amount using a FHA Mortgage calculator.

Before considering FHA Loan, keep a few things in mind.  Loan limits for FHA loans is usually low than that of most of the conventional loans. FHA loans are primarily designed for borrowers with low credit history or who cannot afford 10 to 20% down payment. If you want to calculate the amount of FHA loan you can get, you can visit reputed websites such as Mortgage Calculators and Rates which provide FHA Loan Calculator.