Articles by: Joe Wallace

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.

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What You Should Know About FHA Home Loan Credit Checks As A First-Time Home Buyer

October 3, 2024

How Much Do I Put Down On An FHA Home Loan?

By Joe Wallace

There are persistent myths and misunderstandings about home loans. One persistent myth is that FHA mortgages are only approved for first-time home buyers. Another is that FHA loans are only for low to moderate-income borrowers. And a third–and the focus of our article–is that you have to make a 20% down payment on a home loan. What’s the reality? FHA home loans do NOT require a 20% down payment, even if you are at the lower end of the qualifying credit score range. According to FHA loan rules, the most you are required to put down on an FHA mortgage (on paper, according to the FHA) is 10%. That is for borrowers who do not have FICO scores that qualify them for 3.5% down. So why do people think you | more...

September 25, 2024

FHA Home Loans And First Time Home Buyers

By Joe Wallace

FHA home loans are perfect for many first time home buyers who are looking for low down payment requirements, forgiving credit score guidelines, and a home that features refinance options later down the line for cash-out, rehab and repair, etc. But does a house hunter have to be a first-time home buyer to qualify for an FHA mortgage? The short answer is no. FHA mortgage loans are for any financially qualified borrower, first time buyer or not. That said, first-time home buyers may find an advantage when it comes to local or state down payment assistance programs. FHA mortgages require the down payment to come from approved sources; those sources may include down payment assistance from agencies that provide such funds in accordance with FHA requirements. Down payment assistance must | more...

September 19, 2024

Refinancing Questions To Ask Before You Apply

By Joe Wallace

Are you looking for a refinance loan? Refinancing your home loan can be a smart move for some homeowners, especially in times of falling rates. A 2024 Fed rate cut of half a percent means mortgage loan rates may soon begin coming back down to earth, however gradually that process may be. Potentially lower rates mean more borrowing options, especially in expensive housing markets like New York, California, and Washington, D.C. Smaller housing markets may also benefit. More affordable loans, rising property values (depending on the market), and the ability to pull more cash out of the home in a refi loan situation make applying more attractive. Is your long-term home loan goal to save more money over the term of the mortgage? Or do you need lower mortgage payments | more...

September 18, 2024

FHA Home Loans: How Much Will You Pay Per Month?

By Joe Wallace

How much house can you afford with an FHA loan? If you aren’t sure about the final amount of your monthly mortgage payment as a new house hunter, you aren’t alone. Fortunately, there are things you can do to get an estimate on how much to expect your monthly payments to be. Do The Right Math Don’t make the mistake of doing “the wrong math” for your FHA loan. You should not just use the home’s sale price and possible interest rate to make the calculation. Why? The results you get don’t include other costs you may have to pay each month, and your expectations will be skewed (most likely) to be too low in terms of the actual monthly financial commitment. Home Loan Math Variables The previously mentioned calculation | more...

September 17, 2024

Considerations For Buying Your First Home With An FHA Mortgage

By Joe Wallace

First-time home buyers looking for their first home and a participating lender to apply for an FHA mortgage loan may not know exactly what they are looking for in a new home at first. As you embark on the home ownership journey, several issues will become more apparent. When planning for your first home loan and preparing your credit to borrow, remember these concerns. Buying A First Home To Accommodate Future Needs Couples looking at their first home should anticipate changes in family size, needs for a hobby room or a dedicated workspace, and room to grow with furniture and other possessions. The one-bedroom house you look at today may be the home you grow out of tomorrow; make sure you anticipate your future needs when looking at designs and | more...

September 12, 2024

Need An FHA Refinance Loan?

By Joe Wallace

What do you need to know about FHA refinance loans? If you are considering your options and aren’t sure about some aspects of the FHA refinance process, you may find some answers to your questions below. FHA Refinance Loan FICO Score Requirements FHA refinance loans typically require credit checks and appraisals. There is one exception. There is no FHA requirement for either when you are applying for an FHA Streamline Refinance mortgage. If you need to refinance but worry about your ability to qualify for an FHA mortgage due to credit issues or other problems? Contact the FHA directly at 1-800 CALL FHA. Request a referral to a local, HUD-approved housing counselor who can assist you with planning, budgeting, and other important credit application issues ahead of any purchase or | more...

September 11, 2024

Repair Your Credit Before Your Home Loan

By Joe Wallace

Interested in applying for an FHA mortgage or a refinance loan? It’s not as easy as finding a lender and applying; you will need plenty of time to save for the expenses of the loan including the down payment and closing costs. But you also need more time in another way; taking a preliminary step as early as possible in your loan process can make the difference between loan approval and rejection. What is that preliminary step? Reviewing your credit report for errors and identity theft evidence. It’s also about working on raising your FICO scores based on the results of your credit report review. All Americans are entitled to a free copy of their credit report once per year, so there is no cost to obtain one. You can | more...

September 10, 2024

Bankruptcy Versus FHA Loan Approval

By Joe Wallace

Declaring bankruptcy, either Chapter 7 or Chapter 13, impacts your credit standing. Though it might be a necessary financial step, it disrupts your normal financial activities, including getting a mortgage. But is declaring bankruptcy the end of your ability to buy a new home? Not necessarily. Thanks to “seasoning periods” a borrower waits out after bankruptcy to be declared fit to borrow to buy a home, bankruptcy doesn’t permanently bar you from buying a home. Before discussing the waiting periods for mortgage loans, let’s differentiate between Chapter 7 and Chapter 13 bankruptcies: Chapter 7 Bankruptcy This involves liquidating your non-exempt assets to pay off creditors. While it provides a quicker resolution, it can negatively affect your credit score for up to a decade. Chapter 13 Bankruptcy This allows those with | more...

September 3, 2024

Preparing For Your Home Loan

By Joe Wallace

The real estate market is typically in flux, thanks to various factors. In a given week, month, or year, you may encounter market conditions more favorable to you as a buyer or to the seller. When assessing the current real estate market dynamics, learn whether the county you want to buy a home in is a buyer’s market, seller’s market, or balanced market. The nature of the market is typically determined by some variables, including the supply of homes compared to the demand. In a buyer’s market, more homes are available than buyers, giving buyers more negotiating power. In a seller’s market, there are more buyers than homes available. That provides sellers with the advantage. Neither side has a significant advantage in a balanced market because conditions are more “neutral” | more...

August 29, 2024

Home Loan Approval And Your Credit Scores

By Joe Wallace

It doesn’t matter if you want to buy a single-family home in a rural area or a condo unit in a busy metropolis; if you don’t understand your credit report or know your credit score, you aren’t ready to financially commit to a home loan. Fortunately, the Fair Credit Reporting Act requires the major credit agencies to offer you a free credit report each once per year. In order to buy a home, consumers must become credit-literate. That means knowing how credit reports work, how to interpret credit scores, and how a credit report affects one’s ability to be approved for a loan. There are three major credit reporting agencies: Equifax, TransUnion, and Experian. That is one reason why we encourage borrowers to check their credit reports as early as | more...