Articles in Category: Fixed Rate Mortgage

June 24, 2022

Planning Your Home Loan

The planning stage of your home loan is extremely important. This is where you will determine what kind of home you might want, the price range you can afford, and how much down payment you need to save up to make. One big choice you face in the planning process? Decisions about issues related to long-term occupancy of the home, whether you plan to sell within a short or long amount of time and how you should arrange your financing to accommodate those needs. What kind of arrangements? Some borrowers don’t apply for a fixed-rate mortgage. They know they are not keeping the home for the long term and choose to take advantage of lower interest rates offered in the introductory period of an FHA Adjustable Rate Mortgage (ARM) instead | more...

June 21, 2022

Seller’s Markets, Buyer’s Markets, And FHA Loans

By Joe Wallace

What does it mean to get an FHA loan when you are in a buyer’s market? What does it mean to use an FHA mortgage in a seller’s market? If you are new to house hunting chances are you’ve heard these terms before, but what do they mean in the context of a house hunt? FHA Home Loans In Buyer’s Markets What does it mean to be shopping for a house in a buyer’s market? The simplest answer is that you have an advantage as a buyer because there may be plenty of homes to choose from with little serious competition from other buyers. That lack of competition may be because of the supply of available houses for sale. In a buyer’s market, you would still want to get pre-qualified | more...

June 20, 2022

Celebrating Juneteenth

By Bruce Reichstein

Juneteenth is the newest federal holiday in the United States. Today, we commemorate the emancipation of enslaved African Americans–an event formalized in Texas on the day General Order 3 was issued by Union Army General Gordon Granger. That order announced freedom for enslaved people in the State of Texas on June 19, 1865. The actual day, June 19th, is celebrated along with a formal holiday observation of Juneteenth held on Monday, June 20, 2022 with banks, financial markets, post officers, and schools closing in honor of the day. We too pause our usual discussions of all things related to FHA loans to observe Juneteenth. Thank you for reading and our regular posting schedule returns tomorrow.

June 16, 2022

Factors That Affect Your FHA Mortgage Interest Rate

By Joe Wallace

When the Fed meets to set monetary policy, it has the option to raise or lower the nation’s interest rates. That is a move that can directly affect some areas of the finance sector such as credit cards, but it indirectly affects mortgage loan interest rates. The Fed’s actions don’t actually change mortgage rates. Investor behavior in reaction to the Fed’s announcements, on the other hand, do have the potential to affect mortgage rates. The rate you are offered by the lender tomorrow may be affected by news and developments in the markets today. But that’s not the only factor that can affect the interest rate you are offered. At this stage for many mortgage-focused blogs, a conversation about FICO scores goes right here. It’s true that your credit scores | more...

June 13, 2022

What To Know About Renovating Your Home With An FHA Loan

By Joe Wallace

FHA home loans for renovation include the FHA 203(k) Rehabilitation loan and refinance loan options. There are also FHA Energy Efficient Mortgages or FHA EEMs that allow energy-saving upgrades and improvements to the property. EEMS are add-ons allowed for most FHA home loans, not a separate loan program, and adding an EEM potentially raises your monthly mortgage payment. If you need to apply for an FHA home loan to renovate, the first thing you need to know is that on paper, FHA loan rules say you may be allowed to be your own builder or contractor. However, lender standards will apply and you may find that your FHA lender does not permit this. You’ll need to ask directly as early in the process as possible. FHA loan rules say that | more...

June 2, 2022

Applying For Your FHA Mortgage

By Joe Wallace

After you have gotten all the planning done, and after you have saved for your downpayment and gone house hunting, you’ll come to the place where you are finally ready to apply for a home loan. What do you need to know about this process and how it works? One of the most important things to decide is how much personal help you might need to apply. There are three basic options that may be open to you depending on the lender. Whether you need to pre-qualify, get pre-approved, or actually begin the application process itself, your lender may take a specific approach to how your loan documentation and application data is submitted. Some lenders take a very hands-off approach, allowing you to apply and submit online without requiring any | more...

May 26, 2022

What You Should Know About Using An Escrow Account For Your FHA Loan

By Bruce Reichstein

Are you planning to buy a home? Whether you seek an FHA mortgage or not, you may be required to use an escrow account for the loan transaction. You will need a safe place to deposit earnest money in the buying phase and you may also need escrow to pay your property taxes each year. FHA Loans Require Escrow Your participating FHA lender may require the use of an escrow account. Are you applying for an FHA 203(k) Rehabilitation Loan or an FHA One-Time Close Construction loan? Both types of mortgages require payments to contractors who are renovating or constructing your home. FHA loan funds must be stored in escrow until it’s time to use them. There is no unrestricted cash back to the borrower with these loans, so escrow | more...

May 25, 2022

FHA Condo Loan Rules For Single Condo Unit Approval

By Joe Wallace

Are you looking for an FHA condo loan with a low down payment? Are you having trouble finding a condo project on the FHA-approved list, even with a lender’s help? There may be options for you thanks to the ability to apply for single condo unit approval from the FHA. At one time, FHA loan rules required condo projects to be on or added to an FHA-approved list before they could be considered for an FHA mortgage. But the rules were updated, and it’s possible today to apply for an FHA condo loan for a unit that’s not part of an approved condo project — that unit may still be eligible for an FHA mortgage. This is accomplished via the FHA Single-Unit Approval process which, according to an FHA Mortgagee | more...

May 19, 2022

Appraisals, Home Inspection, And The Systems Of Your House

By Joe Wallace

We write a great deal about not using the FHA appraisal to determine the condition of the home you want to buy with an FHA mortgage. But why do we say this? Why can’t you trust the appraisal alone? Why pay for the home inspection? There are important reasons for homebuyers to pay for a home inspection as well as the appraisal. Here are some things you should think about before you decide to skip a home inspection. The Foundation of Your Potential New Home Your FHA appraiser is not required to be an expert in areas such as the foundation of the home. Some foundation problems may not be apparent in the appraisal process. They may only be revealed during a home inspection depending on the problem. The appraiser | more...

May 18, 2022

Home Loans And Credit: Facts And Fiction

By Joe Wallace

Are you worried about your ability to pass a credit check for a home loan? Some borrowers may be justified in their concerns, especially after recent pandemic-related financial setbacks or interruptions in employment. Sometimes borrowers are misinformed about their chances of being approved for a mortgage–it’s never a good idea to assume you cannot qualify even if you’re concerned about past credit issues. What do you need to know to move forward? FHA Loan Credit Check Facts: FHA Mortgages Have Lower FICO Score Requirements FHA loan rules in HUD 4000.1 say that applicants with FICO scores of 580 or higher technically qualify for an FHA mortgage. But you’ll need to discuss your scores with a participating lender since lender standards may apply above and beyond the FHA minimum. FHA Loan | more...