FHA loans are mortgages issued by qualified lenders, including traditional lenders like Citigroup and Wells Fargo, and insured by the Federal Housing Administration (FHA). The popularity of these loans are skyrocketing and for good reasons. They feature low down payments, low closing costs and are easier to qualify for.
Despite this popularity, there are many misconceptions surrounding FHA loans. Here are just a few myths and the facts behind them.
Myth #1: FHA only loans small amounts to buyers of Santa Cruz homes.
Fact: To help stabilize the real estate market, the government recently raised the maximum loan amount from its original cap of $362,790 to $793,750. The FHA loan amount a buyer can borrow varies by state and county.
Myth #2: FHA