Government-backed loans

From Wikipedia, the free encyclopedia

A government backed loan can simply be defined as a loan subsidized by the government, which protects lenders against defaults on payments, thus making it a lot easier for lenders to offer potential borrowers lower interest rates. Its primary aim is to make home ownership affordable to lower income households and first time buyers. There are numerous types of government backed loans which vary dependent on the county and status of the borrower. Arguably the most widely known type of government-backed loan is the Federal Housing Administration FHA loan which has been in existence since 1934.

Other types of government backed loans include, but are not limited to the following below: