Articles Published in: January 2018

January 11, 2018

Does The Age Of The Property Affect An FHA Home Loan?

Does the age of the property affect an FHA mortgage loan transaction? Not all properties are brand new, and in cases where existing construction homes or other property types are being considered for an FHA home loan, age can and often is a factor. Why is this? It depends on the type of home you wish to buy. FHA Home Loans For Mobile Homes, Manufactured Homes FHA home loan rules for mobile homes and manufactured homes carry a requirement that the property be of a certain maximum age. According to HUD 4000.1, the lender is tasked with insuring that the mobile home was built on or after June 15, 1976, “as evidenced by an affixed HUD Certification Label in accordance with 24 CFR § 3280.11”. The rules in this section | more...

FHA Home Loan Credit Score Requirements: FICO Scores And More

January 10, 2018

FHA Home Loan Credit Checklist

By Joe Wallace

There’s more than one kind of checklist that can help you in the FHA home loan process. There’s an overall mortgage checklist that helps people prepare for closing, but what about in the planning stages when you’re trying to review your credit to insure you are as credit-worthy as possible? Making a checklist specifically to review and prepare your credit is a very good idea, and you can get started with the following steps below. Making an FHA Home Loan Credit Checklist There are three very important areas to keep in mind when making a credit checklist; past credit performance, future credit activity, and the possibility of identity theft and/or outdated information on your credit report. Don’t overlook any of these areas, and be sure to develop a strategy for | more...

January 10, 2018

Bad Credit Scores And FHA Home Loans

By Joe Wallace

Bad credit scores and FHA home loans-do you know what the rules are for FHA credit requirements? FHA loan minimums and FHA lender standards may not be exactly the same, so it’s important to remember that the issues we discuss here are based around FHA minimum guidelines and that you’ll need to talk to a participating lender to see what other requirements must be met. Is There A Bad Credit FHA Home Loan? FHA loan rules require a 500 FICO score at the absolute minimum in order to qualify. Those who apply for an FHA loan with credit scores between 500 and 579 are required to make a higher down payment (10% of the adjusted value of the home) than those who apply with FICO scores 580 or higher. Remember, | more...

January 9, 2018

FHA Home Loan Rules For Buying Investment Properties

By Joe Wallace

What are the FHA home loan rules for buying investment properties? Regular readers of this blog may be confused by this question since our posts emphasize time and again that FHA single family home loans are for owner/occupiers and not for investment properties. So how can the FHA loan Handbook, HUD 4000.1, have rules that govern the purchase of an investment property with an FHA mortgage? The answer is actually fairly simple; FHA loan rules make an exception in certain cases. The FHA home loan policy in this area is explained on page 142 of HUD 4000.1, starting with a definition of the term “investment property”. According to the FHA, “An Investment Property refers to a Property that is not occupied by the Borrower as a Principal or Secondary Residence”. | more...

January 9, 2018

Is U.S. Citizenship Required For An FHA Home Loan?

By Bruce Reichstein

Is United States citizenship a requirement to be considered for an FHA mortgage? The answer may surprise you, but the FHA loan program is designed for a certain amount of flexibility, and the rules in this area are no exception. The rules governing this issue can be found in HUD 4000.1, the FHA loan handbook, which instructs the lender to request specific documentation including a potential borrower’s Social Security Number. According to page 131 of the handbook, “Each Borrower must provide evidence of their valid SSN to the Mortgagee.” FHA Loan Rules For Citizenship And Home Loan Approval According to HUD 4000.1, citizenship is not a prerequisite for FHA mortgage loan approval. However, borrowers will have to provide paperwork showing their status as either resident aliens or non-resident aliens. FHA | more...

FHA Home Loans And The Biggest Credit Mistake You Can Make

January 8, 2018

FHA Home Loan Credit Score Rules

By Joe Wallace

What do you need to know about FHA loan credit score rules? There are issues you can begin addressing very early in your FHA home loan planning process that can help you get closer to FHA loan approval; know these important rules before you apply. If you need to improve your credit scores in order to get approved for an FHA mortgage, you’ll need to begin very early in the planning stages and NOT after you have turned in loan paperwork. FHA Loan Credit Score Minimum Requirements According to the FHA loan handbook, HUD 4000.1, the very lowest credit score you can have and still be considered for FHA loan approval is a FICO score of 500. That is the FHA minimum, and FICO scores below 500 are not eligible | more...

January 8, 2018

How Much Can I Borrow With An FHA Mortgage In 2018?

By Bruce Reichstein

How much can I borrow with an FHA mortgage in 2018? There’s no single answer to this question for a variety of reasons, but in general there are things you should know about an FHA mortgage that can help you understand how much you are able to borrow to buy a home. FHA Loan Limits Are Set By County FHA loan limits are broken down by county in each state. You can see a good example of this and learn what the FHA limit for your area is for the current year, but it is important to note that the dollar amounts you see are calculated before add-ons to the loan such as mortgage insurance premius, FHA Energy Efficient Mortgages, etc. In other words, your loan limit is calculated with the | more...

January 5, 2018

Why Should I Refinance With An FHA Loan?

By Joe Wallace

Why should I refinance with an FHA loan? There are many reasons why you might need or want to refinance into an FHA mortgage. Much depends on your financial needs and goals, and it’s good to know your options for FHA refinancing as you explore the finer points of refinance loans. FHA Refinancing For FHA and Non-FHA Mortgages The FHA refinance loan program has options for both existing FHA and non-FHA mortgages alike. You may also be able to get FHA financing on a property that has no existing mortgage. Talk to a participating FHA loan officer about this option. FHA refinance loan options include cash-out, no cash-out, and more. You don’t have to take cash back on an FHA refinance loan, but if you want a cash-out refinance loan | more...

January 4, 2018

What Do I Need To Know About Applying For An FHA Mortgage?

By Bruce Reichstein

What do I need to know about applying for an FHA mortgage? The answers to this question can help any potential home loan applicant go into the process better prepared and ready to begin the journey toward home ownership. Preparing For An FHA Mortgage Loan Takes Time The average preparation time for an FHA loan can be up to a year or more, depending on the borrower. Why does it take so long to plan for an FHA loan? Part of the prep time involves saving up for the fees and expenses of the loan including appraisals, compliance inspection fees, and the required minimum down payment. Borrowers should expect to pay a minimum of 3.5% of the adjusted value of the home as a down payment; this is required above | more...

January 4, 2018

What Can I Buy With An FHA Home Loan?

By Joe Wallace

What can I buy with an FHA home loan? There are many options available including town homes, condos, mobile homes, manufactured homes, and more. But there is also a list of things you cannot use an FHA mortgage loan to purchase, and that’s good to know going into your search for the right home for you. For example, FHA mortgages cannot be used to purchase any property you don’t intend to live in as your primary residence. FHA home loans are only for properties you will live in as your home address. FHA home loans can be used to purchase homes with a single living unit, but can be used to buy property with as many as four living units. That means that a borrower could potentially buy a four | more...