A government-backed loan is a

loan In finance, a loan is the lending of money by one or more individuals, organizations, or other entities to other individuals, organizations, etc. The recipient (i.e., the borrower) incurs a debt and is usually liable to pay interest on that d ...

subsidized by the government, also known as a

Federal Direct Loan The William D. Ford Federal Direct Loan Program (also called FDLP, FDSLP, and Direct Loan Program) provides "low-interest loans for students and parents to help pay for the cost of a student's education after high school. The lender is the U.S ...

, 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 buyer A first-time buyer (FTB) is a term used in the British, Irish, Canada property markets, and in other countries, for a potential house buyer who has not previously owned a property. A first-time buyer is usually desirable to a seller as they do no ...

s. There are numerous types of government-backed loans, which vary dependent on the country and status of the borrower. Arguably, the most widely known type of government-backed loan is the US Federal Housing Administration FHA loan, in existence since 1934. Other types of government-backed loans include the following: * American Dream Downpayment Initiative - ADDI * Good Neighbor Next Door * HOPE VI * Teacher Next Door Program * VA loan *

State of New York Mortgage Agency The State of New York Mortgage Agency (SONYMA) is a New York State public-benefit corporation created in 1970 by the state government of New York to provide affordable homeownership to low- and moderate-income New Yorkers. It offers affordably pri ...

– SONYMA

External links

Office of Housing
Loans Government finances {{US-gov-stub

See also

External links