October 16, 2019

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Articles in Category: FHA Requirements

Home Loan Advice: Top Reasons For Failed Loan Applications In 2018

Home Loan Advice: Top Reasons For Failed Loan Applications In 2018

– Did you know that a Realtor.com survey reveals that as few as 40% of all potential home buyers apply for their mortgage loan with confidence? As many as 60% of the home buyers in 2018 feared they would not be able to qualify for a mortgage loan. Another survey, issued in September of 2019 by the company CoreLogic, states that high debt and low credit scores were the leading causes of mortgage denials last year. In 2018 alone there were more than two hundred and sixty million loan applications for single-family housing. Those applications were for one-to-four unit properties, as well as a portion of the applications going toward manufactured housing. The CoreLogic report suggests an overall loan application denial rate of just under 25%. And of that 25%, | more...

 
FHA Home loan appraisal rules

New Housing Appraisal Rules? Not So Fast, FHA Loans

If you haven’t paid attention to recent headlines in the mortgage finance sector, you may not be aware that starting October 9, 2019, some house sales priced at or below $400,000 no longer require an appraisal. That news has some house hunters and home sellers jumping for joy. At least at first. Since the mid 1990s, appraisals have not been required for each and every home sale. Homes priced at or below $250 thousand may or may not have required an appraisal (more on that below), but over time, the numbers have shown that home prices have gone up significantly since then. Hence the move to change the appraisal threshold. The FDIC, in partnership with two other government agencies issued the proposal to increase the appraisal limit, the rule was | more...

 
Home Loan Credit Advice From Credit Bureaus

Home Loan Credit Advice From Credit Bureaus

We discuss FHA home loan credit issues here frequently, but our advice is only one source. What do the three major credit reporting agencies have to say about credit issues related to mortgage loans? Equifax, Experian, and TransUnion all have official sites with advice for consumers who want a fair and honest mortgage loan. Let’s examine some of the advice for potential home loan applicants. Mortgage Loan Credit Advice From Equifax The credit reporting agency Equifax has some advice for borrowers, including a very useful tip about how to do damage control on your credit report if a situation beyond your control resulted in late or missed payments. According to the Equifax official site, in such cases, “Consider adding a consumer statement to your credit reports.” Did you know you | more...

 
FHA Home Loan Rules For Mixed-Use Properties

FHA Home Loan Rules For Mixed-Use Properties

FHA Single-Family home loans are designed for those who want to be owner-occupiers. Those looking for affordable housing often turn to FHA mortgages to buy condos, mobile homes, town houses, and typical suburban houses. But there is also the potential to purchase mixed-use properties with an FHA mortgage as long as those homes meet FHA standards, lender requirements, local zoning, and local building code requirements. What are the rules for buying a mixed-use property? To start, the nature of the real estate must be primarily residential in nature. The non-residential use of the home cannot detract from its’ use or status as a dwelling. The FHA Single Family home loan handbook, HUD 4000.1, starts in this area by formally defining what it considered to be a mixed-use property and the | more...

 
Home Buying And Your Credit

Home Buying And Your Credit: Three Simple Tricks

Worried about your credit score? Thinking about buying a home but you don’t know if your credit is good enough to qualify? There is a LOT of home buyer advice out there, especially where improving your credit score is concerned. Work On Your Credit As Early As Possible Do you know how long it takes to dispute wrong information on your credit report? How many people share your first and last name? Do you know how possible or likely it is that someone else’s credit data might end up in your credit report? Or how likely it is that outdated information is still plaguing your credit information? If you don’t you, you are not ready to apply for a home loan yet. No borrower should apply for a mortgage loan | more...

 
It Pays To Shop Around For An FHA Home Loan

It Pays To Shop Around For An FHA Home Loan

Why does it pay to shop around for an FHA home loan? A September 2019 report by Zillow.com has some revealing insights into this. Shopping around for the right mortgage lender can be just as crucial as taking a variety of cars out for test drives when you are thinking about taking out an auto loan. You would never buy a car without taking it for a test-drive and comparing dealer prices on the same make and model so why would you apply for a home loan without comparing prices? The Zillow report says a certain range of house hunter will find a wider range of results when shopping around; those who have low credit scores will, according to Zillow, find great variations in what multiple lenders will offer the | more...

 
What You Need To Know About FHA Refinance Loan Options

What You Need To Know About FHA Refinance Loan Options

At the time of this writing, mortgage loan interest rates have fallen to historic lows; VA and FHA mortgage loan interest rates are at a best-execution 3.75% (offered to the most financially qualified applicants) and many homeowners may be saving thousands over the lifetime of their mortgages by refinancing into a lower interest rate. But what do you need to know about refinancing? There are several aspects to consider before you commit to a specific home loan refinance option. FHA loans offer a variety refinance loan options including the typical simple refinance (offering no cash back at closing time), cash-out refinancing, and for those who have existing FHA mortgages, the FHA-to-FHA Streamline refinance option offers a lot to a borrower with a low interest rate and a requirement that (for | more...

 
Will FHA Loans Let Me Rent Out My Home?

Will FHA Loans Let Me Rent Out My Home?

Will FHA loan rules allow you to rent out the property you purchase with an FHA mortgage? There are many who wish to buy a home to start working as a landlord, but if you wish to do this with an FHA mortgage, there are certain restrictions you will need to know before you commit. Many home loans have specific requirements; a borrower may be permitted to buy an investment property with certain kinds of home loans (not FHA) but the trade off may be higher interest rates, more restrictive terms and conditions (depending on the lender), and penalties for early payoff of the mortgage. Being a Landlord With An FHA Home Loan With an FHA home loan, you are permitted to be a landlord as long as you occupy | more...

 
What You Should Know About FHA Home Loan Amounts

What You Should Know About FHA Home Loan Amounts

Do you know what affects your FHA home loan amount? There are factors that the borrower controls such as whether to make the minimum required down payment or pay more down up front; there are also factors that are in the lender wheelhouse such as the amount of the origination fee and other closing costs. Not all of these factors automatically result in a different home loan amount. Some may be required to be paid up front in cash, others may permit financing in whole but not in part. Still, other expenses may not be required of all transactions but may apply to yours. You may find that in some housing markets, a charge or expense that is reasonable and customary may not be common in other housing markets. Some | more...

 
FHA Loans In Special Flood Hazard Areas

FHA Mortgages In Special Flood Hazard Areas

The FHA lender’s handbook, HUD 4000.1, has instructions for the lender to make sure properties to be purchased with an FHA mortgage aren’t located in certain zones. The lender is also tasked with insuring that if the home is located within certain flood hazard areas that the appropriate hazard insurance is obtained as a condition of loan approval. One such zone is the Special Flood Hazard Area or SFHA. HUD 4000.1 instructs the lender to insure that a home is located in an SFHA as declared by FEMA. “The Mortgagee must obtain flood zone determination services, independent of any assessment made by the Appraiser to cover the Life of the Loan Flood Certification” where applicable. But in general, there are some areas where an FHA mortgage simply is not possible | more...