October 17, 2017

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Articles Published in: September 2016

White House Announces Federal Disaster Assistance For Texas

FHA Proposes New Condo Approval Processes

A recent press release on the FHA official site announces new proposals for FHA condo loan approval procedures. According to HUDNo.16-146, there are significant alterations to current FHA loan policy that are currently under review. “In response to changing conditions in the condominium market, the Federal Housing Administration (FHA) today proposed new regulations governing the approval process for condominium developments. FHA proposes to reinstate single unit approvals in unapproved condominium developments and to require condo projects to recertify their approval status every three years rather than the current two-year requirement.” Individual condo units in projects that are not currently on the FHA approved list would, under these proposed changes, have a better chance of getting single-unit loan approvals if the units meet FHA criteria including (but not limited to) the | more...

 
How much can I borrow with an FHA refinance loan?

UFMIP: FHA Loan Rules

Since we have gotten several questions lately about FHA loan rules regarding funding fees including the FHA Mortgage Insurance Premiums (MIP) and Up Front Mortgage Insurance Premiums (UFMIP), it seemed like a good idea to discuss the rules in HUD 4000.1 regarding these issues, starting with the UFMIP. For FHA single-family forward mortgages, the rules for the Up Front Mortgage Insurance Premium are found on HUD 4000.1 on page 155. It begins with the explanation of both UFMIP and MIP: “FHA collects a one-time Upfront Mortgage Insurance Premium (UFMIP) and an annual insurance premium, also referred to as the periodic or monthly MIP, which is collected in monthly installments.” Some borrowers have questions about whether or not you can finance the UFMIP and how doing so might affect the amount | more...

 
Mortgage Loan Rate Trends

Mortgage Loan Interest Rate Trends: Higher After Days Of Recovery

Mortgage loan interest rates moved higher on Wednesday after a recovery streak that would have hit seven straight business days otherwise. In many cases borrowers would notice the Wednesday changes in closing costs rather than an actual higher rate, but as market watchers are fond of pointing out, even with recent moves higher we are still seeing rates at respectable lows. 30-year fixed rate conventional loans ended Wednesday at a best-execution rate of 3.375%, while FHA mortgage loan interest rates (best execution) are at or near their current comfort zone of 3.25% depending on the lender. You may notice greater variation in the actual rates offered by participating lenders, so it pays to look for the best rates and terms. Best execution rates are listed here assuming an ideal borrower | more...

 
What if my home was damaged in a natural disaster?

FHA Construction Loans: A Reader Question

A reader asks, “Does FHA include loans for a construction to permanent mortgage?If so, can the construction be done by a licensed general contractor that does custom builds or does it have to be done by a licensed general contractor that only does spec builds? Is there other criteria/inspections that are specific to construction to permanent mortgage that are specific to an FHA loan?” This is a complex question, and FHA construction loans have issues far too numerous to address in a single blog post, but we’ll tackle the basics. FHA loan rules do allow for loans for new construction/proposed construction. This type of loan is more complex than a typical FHA mortgage and potential applicants are encouraged to discuss this option with a loan officer to learn what may | more...

 

FHA Loan Mortgage Insurance Premiums

Here’s a version of a common question we’ve been asked recently about FHA mortgage insurance premiums: “I closed an FHA mortgage on a house I purchased in December 2014. The following month FHA reduced the mortgage insurance premium (MIP). Can I get the lower mortgage insurance rate and a reduced monthly payment without totally refinancing my mortgage?” The FHA/HUD official site published a .pdf file that addresses this question directly. Back in 2015 the FHA lowered it’s mortgage insurance premium. The pdf states, “The reduction is effective as of January 26, 2015. Borrowers with case numbers assigned on and after January 26, 2015 will be eligible for reduced annual mortgage insurance premiums.” Note the specific date when the lower premiums become effective-borrowers who have loans prior to these dates will | more...

 
FHA Refinance Loans

HUD Announces Settlement In Mississippi Fair Housing Complaint

Zoning laws don’t come up much in our discussions about FHA mortgages, but when they do it’s usually about whether a property is eligible for an FHA loan because it is in a mixed-zoning area, or there is some zoning law concern that might affect the sale or purchase of a property. But recently zoning laws came up in a completely different way, as we learn from the FHA/HUD official site. The Department of Housing and Urban Development has announced a settlement in a Fair Housing case alleging that zoning laws were applied in a discriminatory fashion. According a press release at www.HUD.gov, “The U.S. Department of Housing and Urban Development (HUD) announced today an agreement with Ridgeland, Mississippi to resolve complaints the city violated the Fair Housing Act when | more...

 
Mortgage Loan Rate Trends

Mortgage Loan Interest Rate Trends: Improving

Mortgage loan interest rates improved on Monday, the fourth business day in a row that rates have recovered. There was an upward trend for some time, but some market watchers and industry professionals are using the word “rally” to describe what they’ve been seeing lately. There was considerable attention on the latest Fed statement about interest rates, but once “Fed day” came and went there was no significant change in investor activity-that is to say no increase activity unfavorable to interest rates in specific reaction to the Fed announcement. 30 year fixed rate conventional mortgage loan rates were reported at 3.375%, best execution, on Monday. That puts conventional loan rates in a single number rather than the range of best execution rates we saw previously. FHA mortgage loan rates are | more...

 

Well Water And FHA Loans: Another Reader Question

We’ve gotten a number of FHA loan questions lately about well water, and properties that are served by wells. It’s true that a home that is served by an individual well or a shared well can be approved for an FHA mortgage loan, but the well must meet FHA requirements. The latest reader question about wells and FHA mortgage loans asks: “Can a single family residence use a water tank to bring the flow test up? This is highly common in the area.” What the reader is asking about is covered-in part-by an FHA mortgage loan rule found in HUD 4000.1, on page 162. There are varying standards for wells depending on whether the well serves an individual home or is considered a “shared well” that services multiple properties. For | more...

 

Divorce and FHA Loans: A Reader Question

A reader asks, “I am trying to qualify for an FHA Loan. I have been apart from my husband for over 13 yrs but not legally divorced. I am currently applying for an FHA Loan and DO NOT want him to be a part of anything Im doing and have FINALLY filed for divorce. House buying is a short sale and I need a fast approval.” “My divorce will take 3 months, I dont have the time! Do I qualify for any type of exception considering we have been apart for 13 years and the IRS has accepted me as an Innocent Spouse Relief and Separation of Liability and Equitable Relief?” This is a difficult question to answer for one important reason: state law is a determining factor in circumstances | more...

 
Can I Add Energy-Efficient Upgrades To An FHA One-Time Close Construction Loan?

Well Water: FHA Loan Questions

A reader asks, “FHA use to only require that these top items need to pass. Lead (first draw), Nitrate, Nitrite, Total Nitrate/Nitrite,Total Coliforms, Fecal Coliforms or E. Coli. Is this still true? I am hearing that a full water panel is required to be done, is this now true and if so,is FHA major focus still on the top items passing? Also what is required by FHA if one of these items fails?” This question is in reference to FHA requirements for properties that are served by wells. In general, the local health authority would set the standards, so the reader would need to consult with the local authority to get the answer to the first part of this question. Health standards, procedures, and requirements can and do vary from | more...