Many in the real estate industry were concerned about the fallout of a proposed cap to maximum seller contributions from 6 percent to 3 percent for home purchases using FHA-insured loans. But the FHA is weighing another change that may cause less concern, Inman News reports.
FHA Mortgage Home Loan Interest Only
Interest Only FHA Loans
If you are looking to reduce your payments as low as possible than an interest only is the right choice. Interest only loans were originally only available to a select few. They were created to allow to only the tax deductible portion of a mortgage to be paid. Over the years many started to use them to finance a much larger loan than what you can get with a fully amortized FHA mortgage.
An interest only option may be available on your loan. Since payments are much smaller it can help you budget your expenses. As with anything there are disadvantages in that you will only build equity if your property increases in value. An interest only loan does not pay down the principal. However the interest only period may vary per program. Some programs may require a fully amortized payment after a set period. Please inquire with one of our loans officers for more details.