FHA VA Foreclosure

Here we'll discuss the FHA VA foreclosure process. Although the process is similar for both of these processes, there are some differences.

The Federal Housing Administration (FHA) is a government agency that is part of the Department of Housing and Urban Development. It insures mortgage loans made by its approved lenders. The FHA allows borrowers to get loans with a very low down payment (3%) by insuring the loan against non-payment.

When the homeowner falls behind on the loan, it is the FHA which is on the hook for most of the loan. For that reason, the FHA has standard procedures in place to help you the homeowner avoid foreclosure.

The Department of Veterans Affairs (VA) guarantees 25 to 50% of the loan amount to the lender. If a borrower with a VA loan defaults on the loan, the VA is on the hook for up to 50% of the loan, so they too have plans in place to help you the homeowner avoid foreclosure. In fact, in certain cases, the VA is even able to lend you money in order to reestablish your loan after you've fallen behind.

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