Limted Loan Choices for Memphis Home Purchases

In the not so distant past, getting a loan for a mortgage on Memphis Homes, was as easy as opening a bank account, just about anyone could do it! Those days are long gone; there are only two types of mortgage loans left; the loans that are for the people with impeccable credit scores and can afford a large down payment, and the loans that are backed by the Federal Housing Administration (FHA). The FHA loans haven't been the most popular loans in the not to distant past; however, nowadays they are necessary. The FHA loans are now easily one third of all processed loans.

The FHA will insure the mortgage loans owned by the bank with an upfront fee and a monthly premium, however, your credit does not have to be shiny and the down payment can be as low as 3%. The down payment amount is due to increase to 3.5% at the first of 2009. The low down payment is the attraction to this type of loan, which is why many are calling the FHA loans the new Subprime Mortgage. Unlike the subprime market, however, employment and income will be verified to ensure that the mortgage can be covered.