FHA Loan Rates by Type of Loan

FHA loan rates can vary due to many factors. One such factor is the type of FHA loan. Loan rates can be very different from one loan type to the next, so it is important to consider your options before you actual get an FHA loan. The following will explain some of the common FHA loans that you may be offered.

General FHA Loan Information

One of the important things that you have to understand about an FHA loan is that it is not actually a loan. The FHA loans out no money. An FHA loan is actually a type of loan. It is insured by the FHA, which is an agency of the federal government. You actually get the loan from an FHA approved lender.

FHA loan rates may differ from other types of mortgage loans because of the fact that they are insured by the federal government. They are considered a less risky loan and therefore lenders will usually lower rates on these loans.

Adjustable Rate Loan

The first type of FHA loan you can get is an adjustable rate loan. With this type of loan the FHA loan rates will change over the life of the loan. As the lender makes rate changes, your loan will reflect those changes. You may not always know what your payment will be from month to month and you will not know the exact amount of your loan at any given time. The benefit here, though, is that when rates fall you see your mortgage payment get lower.

Fixed Rate Loan

Unlike an adjustable rate loan, with a fixed rate loan your FHA loan rates stay the same for the life of the loan. A fixed rate loan is much more stable and you know exactly what your payment will be every month and you know the exact amount of your loan at any given time. If rates do fall you cannot take advantage of them unless you refinance.

Graduated Payment Loan

With a graduated payment loan your payments start out at a low price and gradually increase over the life of the loan. This type of loan is good for someone who anticipates a rise in income over time, but right now may have a limited income. The FHA loan rates on this type of loan are usually dependent upon the lender.

FHA loan rates can very just as with any other type of mortgage. You should always discuss rates with your lender to be sure that you are getting the best deal possible. It also helps to shop around. Even if you are positive that you want an FHA loan, you can still shop around with different FHA lenders to find the best FHA loan rates.

Check out my other guide on mortgage calculater and current mortgage interest rates

Fha Loan Rates

fha home loan rate

FHA Loan Rates by Type of Loan

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