What kind of federal mortgage programs does the government have for assistance of home owners?


The federal government does not administer mortgages on its own, however, the Federal Housing Association (FHA), under the US Department of Housing and Urban Development (HUD) offers several insurance programs to assist single families with purchase of their home loans. Some of them are:

Section 203(b) Mortgage Insurance

The purpose of this insurance program is to provide insurance for a single family to refinance/buy a primary residence. A mortgage lender provides the funds and the insurance is provided by HUD.

Section 203(b) Mortgage Insurance for Disaster Victims

As the name suggests the purpose of this insurance program is to help victims of a major disaster, who have lost their homes, to get mortgages and become homeowners again. Any citizen who has lost their home in a presidentially declared disaster area is eligible to apply for this program.

Section 255 HECM Program

The Home Equity Conversion Mortgage is a reverse mortgage insurance program for senior citizens above the age of 62. What happens in this program is that a homeowner who has paid or nearly paid their mortgage is allowed to borrow money against the equity of the house from an FHA approved lender, and the loan is insured by the FHA. Lenders recover their principal, plus interest, when the home is sold.

Section 203(k) Rehabilitation Mortgage Insurance

The purpose of this program is rehabilitation and repair of single family properties for general community and neighborhood development. The idea is to provide homeowners with quick access to cash for home improvements/repairs. The repairs have to be first identified by a FHA appraiser for qualification to this program.

Energy Efficient Mortgage Program

The Energy Efficient Mortgage program (EEM) helps homeowners to finance the addition of energy efficient appliances and features to their homes by rolling the costs into the FHA insured home purchase or refinancing mortgage. The FHA encourages lenders to finance borrowers who wouldn't otherwise qualify for affordable, conventional loans (e.g. first time homebuyers) and to homeowners in poorer neighborhoods.

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