Articles Published in: November 2018

November 19, 2018

FHA loans: A Mortgage For First-Time Home Buyers

While it should be pointed out that FHA mortgage loans are not restricted to those who have never owned a home before, it’s also good to note that FHA mortgages are an excellent choice for first time buyers since they won’t be required to buy homes with 20% down. Low- and no-downpayment mortgages are obviously an advantage to the first time home buyer; how does an FHA mortgage help these borrowers? Verify Your FHA Loan Eligibility All mortgage loans have eligibility standards; FHA, Fannie Mae and Freddie Mac, rural housing loans guaranteed by the USDA or even the 100% loans offered to qualifying veterans (VA loans) guaranteed by the Department of Veterans Affairs all have financial eligibility requirements. And all of these loans have minimum program guidelines that may or | more...

November 16, 2018

Buying Real Estate With An FHA Mortgage Loan In 2019

By Bruce Reichstein

If you want to buy real estate with an FHA mortgage in 2019, there are several things you can do to get ready for a successful loan application and closing date. One of those preparations? Learning what you can and cannot buy with an FHA home loan. FHA Mortgages In 2019: Your Real Estate Options Many published reports speculate that in 2019, house prices will begin to come down and areas where the real estate environment is considered a seller’s market may begin to shift toward the borrower again. What kind of real estate inventory you have access to depends on the housing market where you want to live, but there are some things you should know about your home loan options before you decide to start looking. Namely that | more...

November 15, 2018

How Much Should I Put Down On A House?

By Joe Wallace

Thinking about getting pre-qualified or pre-approved for a mortgage loan? FHA mortgages generally require a lower down payment and have more forgiving terms for loan approval, but the amount of money you put down isn’t just guided by your financial qualifications (see below), it also depends on your financial goals. A National Association of Realtors report from 2017 indicates that a large number of people put down less money than you might think to purchase their dream home. Some of the zero-money-down transactions are likely either VA loans (available for qualified veterans and dependent on serving a minimum amount of time in uniform) or USDA loans which also have a zero down payment option. But in some cases you may actually wish to make a larger down payment. Why? In | more...

November 14, 2018

FHA Home Loan Basics: Who Qualifies?

By Joe Wallace

Are you looking for a home loan? Do you want to buy a home with a mortgage loan in 2019? The FHA Single-Family Home Loan program offers a wide variety of options for qualifying borrowers, but some future home owners make the wrong assumptions about FHA mortgages. How much do you know about this important home loan option? FHA Home Loans Are For Any Financially Qualified Borrower Regardless Of Past Home Ownership If you have applied for a home loan in the past, owned a home before, or are a current home owner, you are not excluded from consideration for an FHA mortgage under the rules of the FHA program. This is true of all FHA mortgages including One-Time Close construction loans, FHA condo loans, and FHA mortgages for multi-unit | more...

November 13, 2018

FHA Home Loans For 2019

By Bruce Reichstein

What are your FHA home loan options in 2019? Those looking to start house hunting in the new year should know about FHA loan guaranty limits and how those limits can change from year to year. This is a very important detail of the home loan process you should know before starting the search for your dream home. FHA loans have limits that are set periodically and can change from year to year. For many years, the basic limit did not change, and in high or low-cost areas the limits are naturally different but the amount of those respectively higher or lower limits don’t always change. However, in 2018 FHA loan limits did change, and borrowers found they had increased limits according to FHA Mortgagee Letter 2017-16. The national limit | more...

November 12, 2018

FHA One-Time Close Construction Mortgages For Dream Homes Part Two

By Bruce Reichstein

Why choose to build a home instead of buying an existing construction property with an FHA mortgage? Some borrowers simply don’t want the hassle of house hunting or can’t find the right existing property. In cases where an FHA borrower wants a home built for them, the FHA One-Time Close construction loan (OTC) can be a major help. In a previous blog post, we started discussing why borrowers should choose an FHA construction loan over a conventional one. There are plenty of reasons including these: Lower Down Payments As with interest rates, FICO scores and other credit qualifications will play an important role in the down payment requirement you are given with FHA OTC mortgages. In general borrowers should expect to make a minimum down payment of 3.5%, but borrowers | more...

November 12, 2018

Build Your Dream Home: FHA One-Time Close Construction Mortgages

By Joe Wallace

FHA One-Time Close construction loans, also known as construction-to-permanent mortgages, are a way that borrowers who need a lower down payment and more flexible loan approval guidelines can apply for a home loan that allows the property to be built from scratch. One-Time Close loans, which are sometimes referred to as FHA OTC mortgages, require the borrower to qualify only once for both the construction portion and the mortgage loan. This type of FHA mortgage may vary more among participating lenders because of certain features of the loan including the type of property that can be built, and the loan approval process as it relates to getting construction permits for the project. Some Options Are Available With Some Lenders But Not Others: Shop Around! Your participating lender may not offer | more...

November 12, 2018

Happy Veterans Day 2018!

By Bruce Reichstein

Happy Veterans Day! Many banks will be closed to observe this federal holiday, bond markets are closed, and we pause in our usual routine of answering questions about FHA home loans to honor our nation’s vets. Thank a veteran for her service, and remember the sacrifices all our troops have made no matter where in the world they may be stationed. To all current and former members of the U.S. military, THANK YOU for your service! Our regular posting schedule resumes tomorrow.

November 9, 2018

FHA Mortgage Loan, Dropping Home Prices, And Your Appraisal

By Joe Wallace

You may read articles discussing home prices moving lower on real estate blogs or lending websites; when house prices move from one part of a cycle to another there is sometimes confusion related to the valuation of a home. Why would an FHA borrower looking at a house in a neighborhood or housing market with prices trending in one direction get back an FHA appraisal indicating that the home the buyer wants isn’t valued in the same way? Higher or lower, why does one home get valued “as expected” when another one does not? There are a set of variables at work in the appraisal process that include not only the age/condition of the home, but also how other houses stack up against the one you want to purchase with | more...

November 7, 2018

What Is An FHA Loan?

By Bruce Reichstein

What is an FHA loan? What are they used for? These are fairly basic questions, but there is a surprising amount of confusion about certain aspects of the FHA mortgage loan program. Know these facts about FHA home loans to make the decision about buying or refinancing a home loan with an FHA mortgage. FHA Single Family Home Loans Are For House Hunters FHA loans are intended for those who wish to purchase a home using a government-backed loan that requires a lower down payment than many conventional loans. These loans cannot be applied for to be used as personal loans, though FHA cash-out refinancing is an option for borrowers who have equity built up in the home over time. FHA loans are intended for owner/occupiers, and there is an | more...