Types

• FHA offers various insurance programs to guarantee mortgages on single-family, one- to four-unit residences, multifamily properties, manufactured homes and healthcare-type facilities. The 203(b) insurance for single-family homes is its most widely used program. FHA is popular among first-time, low- to moderate-income borrowers because of its relatively flexible qualifying requirements. Its programs may be used to purchase or refinance property. Non-FHA borrowers may refinance their conventional loans through FHA as well. FHA also offers a reverse mortgage for borrowers 62 years and older called the Home Equity Conversion Mortgage and a rehabilitation loan called the 203(k) program to repair single-family homes.
  
  

Acquiring

• Only approved lenders may originate FHA-insured loans. Borrowers may get help with acquiring an FHA loan from HUD's roster of approved lenders, which can be found on the Department's website. FHA's programs operate through HUD-approved lending institutions such as private mortgage companies, banks, savings and loans and credit unions. The lender's underwriter decides whether an applicant and the home meet FHA's minimum standards for insurance by reviewing borrower income, asset and credit information and analyzing property characteristics through an appraisal process.
  
  Qualifying criteria for the 203(b) program is found in HUD Handbook 4155.1. Online and print versions are available through FHA Outreach and HUD's website.
  
  

Servicing

• HUD implements FHA programs and is responsible for monitoring the servicing of FHA loans. Borrowers in need of help with their FHA loan after settlement, may turn to their servicer for help, such as payments, escrow account and insurance information. The servicing company may differ from the lender that originated, or originally held the loan, and must also be HUD-approved. Borrowers may file a complaint against their servicer with HUD, which takes corrective action against servicers that violate the Real Estate Settlement and Procedures Act (RESPA) or HUD's other procedural and "prudent servicing" standards, according to Handbook 4330.1.
  
  

Foreclosure

• Borrowers in need of help to prevent default on their FHA loans have several options. HUD's pamphlet for homeowners entitled "How to Avoid Foreclosure" outlines procedures and options for distressed homeowners. They may appeal to their loan servicer's loss mitigation department and a HUD-approved counselor for the best options. Borrowers in default or in danger of default may be eligible for a loan modification or special forbearance to stay in their home or a short sale or deed-in-lieu of foreclosure to avoid losing their home. The lender may also be able to work with FHA to obtain a partial claim in which the FHA Insurance Fund makes a one-time payment to bring the mortgage current, according to the pamphlet.