September 20, 2018

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Articles by: Bruce Reichstein

Bruce Reichstein - Staff Writer

By Bruce Reichstein

September 20, 2018

Bruce Reichstein has spent over three decades as an experienced FHA and VA home loan mortgage banker and underwriter where he was responsible for funding “Billions” in government backed mortgage loans. He is the Managing Editor for FHANewsblog.com where he educates homeowners on the specific guidelines for obtaining FHA guaranteed home loans.

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What You Need To Know About FHA Loans And Income Verification

What You Need To Know About FHA Loans And Income Verification

What do borrowers need to know about FHA home loans and income verification requirements? The short answer is that it depends on several factors including the nature of the borrower’s job. Why is this true? Why isn’t there a standard answer? Because there are a variety of different employment types and FHA loan rules must address them. Self-employed borrowers are held to a different set of requirements because verifying that income requires a different set of procedures than for “traditional” employment. Those who work in the gig economy as contractors, 1099 workers, etc. are also in a different set of circumstances than a typical 9-5 worker, so those employees need their own procedures, too. FHA Loan Income Verification Rules For more traditional employment, the lender may require pay stubs, tax | more...

 
How Do Student Loans Affect My FHA Mortgage?

How Do Student Loans Affect My FHA Mortgage?

How do student loans affect your FHA mortgage? Is it harder to get FHA loan approval if you have student loan debt? What if the debt is not currently due or being paid in monthly installments? FHA loan rules in HUD 4000.1 (the FHA loan handbook) address these issues. Student loan debt is in a category of its’ own thanks to rule changes a few years ago taking student loans into account during the review for credit worthiness. Student loans once upon a time were in a category called “deferred obligations” because it was possible to have a student loan debt and not be required to pay at that moment; the amount of the deferred obligation was taken into account in a certain way by the lender. But after the | more...

 
FHA Loan Rules And Investment Properties

FHA Loan Rules And Investment Properties

FHA home loans are generally intended for owner/occupiers; there is an occupancy requirement for the FHA single-family home loan program that basically allows loans for principal residences and denies loans for those who do not intend to occupy the home within 60 days of loan closing (unless other arrangements are made for a delayed move-in which may or may not be possible depending on the lender). HUD 4000.1 has the rules that govern occupancy and the purchase of homes considered to be investment properties. HUD 4000.1 begins by defining what it considers an investment property to be: “An Investment Property refers to a Property that is not occupied by the Borrower as a Principal or Secondary Residence.” That is fairly simple, and the rules in this section go on to | more...

 
FHA Rehab Home Loans For Disaster Victims

FHA Rehab Home Loans For Disaster Victims

Those living in federally-declared major disaster areas may be eligible for an FHA home loan to replace or repair properties that have been damaged by the disaster such as a hurricane, floods, etc. FHA 203(h) rehab loans are designed specifically for this purpose-the 203(h) disaster loan features no down payment, an FHA FICO score requirement of 500 or higher, and the rehab loan can only be used for principal residences only. That means owner-occupiers only. How does the FHA 203(h) rehab loan work? HUD 4000.1 has the rules for this type of mortgage loan. The FHA 203(h) rehab loan is quite similar to the FHA 203(k) rehab loan which is available to any financially qualified borrower who meets FHA occupancy requirements for the home. FHA rehab loans allow funds to | more...

 
Five FHA Home Loan Questions To Ask Your Lender

Five FHA Home Loan Questions To Ask Your Lender

There are some important questions to ask a prospective lender when you are shopping around for a home loan. Make the most informed choice you can about selecting your lender, and remember that it pays to shop around for an FHA mortgage! #5: Will You Provide Me With An FHA Loan Estimate? The Consumer Financial Protection Bureau (CFPB.gov) advises borrowers that lenders are required to provide a loan estimate within three days of application. CFPB says the estimate should include the following: estimated interest rate monthly payment taxes and insurance total closing costs for the loan The estimate should also include how the interest rate and payments may change where applicable. Lenders should be willing to provide this estimate. #4: Are The Terms Of This FHA Loan Subject To Change? | more...

 
FHA Mortgage Refinance Checklist

FHA Mortgage Refinance Checklist

If you are exploring your refinance loan options, FHA refi loans can help with cash out refinancing, rate-and-term refi, or even a refinance loan that lets you rehab or remodel your property. If you want a refinance loan, it’s a very good idea to assemble a checklist in the planning stages so you know where you need to focus to prepare for the new loan. There is more than one area to make checklists for including areas like your credit, your home ownership goals, and the plans you have for your refi loan. FHA Refinance Loan Checklists: Goals And Financial Plans A good checklist includes the reasons for your checklist items in the first place. Ask yourself why you want to refinance your mortgage-make a list of pros and cons | more...

 
FHA Home Loans: Five Reasons To Buy A Home Instead Of Renting

FHA Home Loans: Five Reasons To Buy A Home Instead Of Renting

In our last blog post we discussed some reasons to purchase a home with an FHA mortgage instead of renting a property. Most of the reasons discussed in the previous post had to do with financial matters including the fact that renters gain no equity in their rental homes, and they have no ability to apply for a cash-out refinance loan based on the current value of the home. Reverse mortgages are unavailable to renters, too. But there are other reasons to buy a home and not rent. Are you thinking of an FHA mortgage to buy a home based on some of the reasons listed below? There are compelling arguments for each of the five reasons. #5: Buying A Home Means More Privacy Borrowers who own their own homes | more...

 
Five Things You Should Know About FHA Refinance Loans

Five Things You Should Know About FHA Refinance Loans

Five things you should know about FHA refinance loans include the fact that you can find an FHA mortgage to refinance any typical home loan, you can get a refinance loan with cash out, and you can refinance a home to remove an ex-coborrower, spouse, or other persons from the mortgage. #5: FHA Refinance Loans Are Available For Both Existing FHA Mortgages And Non-FHA Mortgages You may only refinance a mortgage using an FHA refinance loan, but the types of mortgage you can refinance include FHA, VA, conventional, USDA, etc. You do not have to have an existing FHA mortgage to apply for FHA refinancing. You are required to occupy the home being refinanced with the FHA mortgage, and refinance loans for secondary residences may be limited depending on the | more...

 
FHA loans

Happy Labor Day 2018!

Happy Labor Day 2018! Today we pause from our usual schedule of posting about FHA home loans, FHA/HUD news, and refinance loan advice to observe the holiday. We’ll be back with our regularly scheduled posts tomorrow. Thank you for reading, and have a safe holiday! We look forward to resuming our regular schedule tomorrow.

 
FHA Refinance Loans: Is There A No-Credit Check Refi?

FHA Refinance Loans: Is There A No-Credit Check Refi?

Some borrowers need to know: is there an FHA refinance loan that has no credit check? This question is more common than you might think and the answer depends on several variables. FHA Refinance Loans That Require Credit Checks There are many FHA mortgage loans that require both a new credit check and a new appraisal. Cash-out refinance loans are in this category, as are FHA reverse mortgages also known as Home Equity Conversion Mortgages (FHA HECM). The lender is tasked with making sure the borrower can afford the new loan and that the borrower is an acceptable credit risk. After all, cash is going back to the borrower in the case of both an FHA reverse mortgage and an FHA Cash-Out Refinance loan and the financial institution will need | more...