Do not make this mistake: Don’t hire someone to help you foreclose on your home or get a short sale for your home. You are wasting your money.

Next, don’t make this mistake: Don’t allow your home to go to short sale or to foreclosure without first contacting an FHA loan representative to find out if there is any help available to you. Most home loan borrowers will find some options to help them avoid losing their home to either of these financially devastating situations.

What happens when you go through a short sale or a foreclosure? What you may not realize is that both have the same end: you will lose your home and you will have long-term damage to your credit record. There is some evidence that both are just as hurtful to your credit, even though many will try to “sell” you on the idea that home foreclosures are worse on your credit than short sales.

What you do not need is to buy information or advice from a third party, especially when you are already having a difficult time with finding money to pay your lender.

Remember This!

If you do go through a foreclosure or you do have a short sale, one thing is for sure: you will be unable to get a new home loan for at least three years that is insured by FHA. Though there are some exceptions, they are few and only in dire situations. The fact is, if you do go this route, you won’t be able to get FHA insured loans later and that will hurt. More so, any time in the future that you apply for a mortgage, even well after those three years, you will need to state that you lost a home to foreclosure or to a short sale.

According to some experts, the only difference in the two in the long term is that in a short sale, you were involved in the process, or “at the table” for what happened. Whereas in a foreclosure, most home owners have little to do with the legal proceedings.

But, I’m Going To Lose My Home!

Those of you who are in rough water right now, hang tight. Contact an FHA loan advisor to find out if there are any current programs in place to help you through this difficult time. Most home owners are able to get the financial help they need. Many will find FHA loan options to keep them in their homes and to avoid all of these costly situations. You do not need to pay someone to short sell your home for you!

There are outstanding opportunities for investment in the home loan field, even if all the news coverage lets you believe there are none. The current mortgage market is getting the squeeze but that is not to say there are not opportunities or that everyone will be effected. Soon to be home owners, or those hoping to be home owners will find options to select from in home loans.

Credit….It Matters

Those looking for an opportunity to find a home loan to buy their dream home, starter home or any home in between, need to realize that credit scores make a large difference. Many lenders are shying away from lending to those who have low credit scores or have had difficulties in the past. With so many filing foreclosure, it’s understandable that these loans are harder to get…but all is not lost.

Even if you do have some problems, there are solutions available to you. One of the best solutions for borrowers with less than stellar credit is to consider FHA loans. FHA is a government department that provides an added level of security to lenders. While they will not help you specifically, they will provide lenders with some security to lend to you. Indirectly, it does help the homeowner though. With FHA insuring your mortgage, lenders look more favorably on your application. They have less risk investing in you with FHA behind you. Therefore, even for those who have a lower credit score, interest rates may be less.

Good Credit Helps

Home buyers with good credit will find opportunities available to them. In some situations, shopping around from lender to lender may give you an advantage at this point. Now, there are less qualified applicants to choose from, so lenders are going above and beyond normal offers to attract good borrowers. It is estimated that as many as 1/3 of applicants who qualified for loans in 2005 and 2006 no longer have the ability to qualify for the same loans today. This takes into account the loss of subprime loans and alternative loans that are no longer being offered as lenders tighten their belts.

Step To Getting The Best Loan

You want to buy a home. You want the most affordable home loan with the largest amount available to you, that fits within your budget. Here are some tips and steps to help you find that ideal home loan.

• Do not overlook the benefits of FHA loans. I cannot stress enough that for anyone borrowing; this is the best route to take.
• Improve your credit as much as possible…or at least do not make it worse. It will make a big difference down the road.
• Compare lenders, not all will offer you the same interest rate no matter what your credit score is. Most lenders will offer FHA loans though.
• Secure a down payment if possible to lower your interest rate and to look more favorable to the home loan lenders.
• Have stable income, and a good employment history. Do not expect to get a loan that offers a large line of credit if you cannot show proof you can actually make the payments.
• FHA administrators are encouraging (and I do too) that you look for a fixed rate loan. FHA loans offer fixed rates and the ability to refinance down the road if you decide to.

Getting a home loan is not easy right now, by any means. Most experts do not believe the mortgage industry is going to get any more flexible until the number of foreclosures slows down. This could take another year or longer to see results in. Yet, you do not have to wait too long to see a home loan. The fact is, with the help of FHA and other loan programs; you can get a good loan at an affordable interest rate.

Any potential home buyer should be concerned with the current housing market. More importantly, they should be concerned with the types of loans available to them. As a first time home buyer (or even those who have been around the block- quite literally) should realize, getting into a low rate mortgage loan offering a fixed rate should be the optimum option. I highly recommend your first contact is through an FHA loan professional. FHA, or the Federal Housing Association, provides fantastic opportunities for individuals looking for affordable loans.

However, should you invest now?

Chances are good you have heard all the worries on the national news programs:

• Credit harder to get
• The housing market continues to fall
• Home values are falling
• There is a lot of risk

Nevertheless, you may not realize that on a more local level, this is not the case. You see, when nationally televised programs are offering stats on how the housing market is doing, they are only seeing the big picture. The facts are that the local picture is much clearer and still offers fantastic opportunities for home buyer. In fact, there is an abundance of homes on the market, many of which are well priced and fully featured; meaning now you will pay less for the home of your dreams than you would have three to five years ago.

Look at a local situation closely. For example, the Port Orchard Independent, a Washington publication, offered a better look of what the housing market is really offering in their neck of the woods. There, for example, there are some excellent opportunities.

• Interest rates on mortgages are at historically low points now, making it more affordable to buy a home at this point
• Washington state banks, consumer loan companies, mortgage brokers and even local credit unions have the funds available to loan to those who have average or better credit scores.
• A variety of FHA programs are now available for those looking for a low cost way to get into a home.
• More variety in loan programs including expanded FHA guidelines make it a better time for the home buyer to get the type of home they want.
• There is a large selection of quality homes, as well as new homes on the market in most areas.
• In Washington, in particular, home values are steady, not plummeting as most news reports show.
• In fact, Washington’s economy is outperforming that of other states and the national economy as a whole

It’s Not Just Washington

While these are some facts about Washington State’s current situation, the fact is, many states are seeing the same evidence. Before you hold back on buying a home because you are worried about the national level of housing market success, look at the local point of view. You may find that the local market is an ideal opportunity for investment.

Make A Personal Decision

It is also important to make a personal decision about investing in a home now. Are you at the right place in your life to make a good investment happen?

Take a look at your current credit score and boost it anyway you can, such as paying down debt and by making payments on time. Also, be sure to pull a credit report to remove any mistakes that could be there. Improve your credit for as long as you can.

In addition to this, realize that the best programs available to you currently are likely FHA backed loans, because they provide lenders with more security and are more likely to be funded at a lower interest rate.

You are an individual who would like to get into their first home. You are worried, even scared to get started due to the number of risky loans out there. The headlines tell the story themselves.

“Subprime Smack Down”
“Foreclosures Increase Homelessness”
“Countrywide Accused of Predatory Loans and Misleading Ads”

And, these are the nicest you have seen. The media has made the housing market even worse than it is. The fact is, for someone with decent credit, there are some of the best opportunities available, especially those who qualify for FHA loans.

Look at the facts.

#1. Home inventory numbers are at the highest they have been in recent memory, which means there are plenty of homes to select from if you are ready to get into them. If you have been on the fence, now is the time to jump off.

#2. Interest rates are at record lows. The Fed recently announced that they would keep interest rates at this historically low point for this quarter (2 percent prime lending is not very bad at all.) In other words, these home loans are inexpensive.

#3. It is a buyer’s market. There is no doubt about it, cheap homes are out there in record numbers. Housing prices have slowly fallen to levels as low as 31 percent of their record high numbers in 2005. They are not likely to continue to fall much farther, many economists say.

For those considering buying a home, there are aspects to worry about. For example, many home buyers are rightly concerned about the risks of getting into a loan that is not stable, too costly or even worse, working with a lender that may go under. Those are important worries, but an FHA loan may help to put your worries aside.

In record numbers, FHA has been helping home buyers to get into more affordable loans. There is no reason to worry about lending when you have this government-backed loan for your home. Moreover, FHA loans are even more affordable than those that are conventional. They are more readily available too, since you do not have to have a large down payment or a perfect credit score to get into them.

The headlines you see are worrisome for many reasons. In addition, while there are risks with some lenders and with those in subprime loans, there are still opportunities available to homeowners who are looking for new opportunities. If you are considering the purchase of a home, get into it through FHA.