January 19, 2018

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Articles in Category: FHA Requirements

How to use an FHA home loan

How To Use An FHA Home Loan

Do you need to know how to use an FHA home loan? There are many things you can do with an FHA mortgage, or an FHA refinance loan. Some of your options include buying a home with more than one living unit, refinancing an existing loan to do rehab or repair work, and including energy-efficient upgrades into your new mortgage. Use An FHA Home Loan To Buy Your First Home FHA home loans are not specifically targeted at one type of buyer, but first time home buyers enjoy the lower down payment requirements and more lenient FHA credit requirements. First time home buyers may learn early that the FHA home loan program isn’t strictly for first homes, but that the participating lender has some kind of first-time buyer incentive. This | more...

 
How To Get Cash Back On An FHA Home Loan

How To Get Cash Back On An FHA Home Loan

Do you need to know how to get cash back on an FHA home loan? Some borrowers ask if it is possible to apply for more mortgage loan money than is required to complete the transaction with the intent of taking that excess in cash like a personal loan. Is this possible? That specific scenario is definitely NOT possible under FHA home loan rules. Borrowers are not permitted to get cash back in such cases except in the form of a refund for money paid up front for items that were later included in the mortgage loan. In some cases a refund might come from an unexpected source, but those payments are still considered a refund and not “excess cash back”. A good example of this? When a borrower refinances | more...

 
Who Can Apply For An FHA Mortgage? Part Two

Who Can Apply For An FHA Mortgage? Part Two

Who Can Apply For An FHA Mortgage? In our previous blog post we addressed some common misconceptions about FHA mortgages, but there is a long list of FHA home loan uses including refinancing, fixer-upper loans, and much more. Who can apply for an FHA home loan? You may find your own needs represented somewhere in this list of approved FHA loan uses. FHA Loans Are For Owner/Occupiers You can apply to buy a property up to four units, and act as a landlord to rent out the units you won’t be living in; FHA loans have an occupancy requirement so you cannot buy a home with an FHA mortgage unless at least one person obligated on the loan will live there as the primary residence. FHA Loans Are For U.S. | more...

 
Who can apply for an FHA mortgage?

Who Can Apply For An FHA Mortgage?

Who can apply for an FHA mortgage? The answers may surprise you; there are misconceptions about FHA home loans that many have to this day, including who is eligible to apply and when. Do you know if you are eligible to apply for an FHA loan or refinance loan? FHA Home Loans Are For All Income Brackets There is no such thing as earning too much money to qualify for an FHA home loan. Some mistakenly believe that there is a maximum income for FHA home loans that excludes people who “earn too much”. This is not true. There is no maximum income limit for an FHA home loan. You will be required to furnish bank statements, pay stubs (electronic or otherwise), and tax documentation to establish your income, but | more...

 
What Is The Interest Rate For FHA Refinance Loans?

What Is The Interest Rate For FHA Refinance Loans?

What is the interest rate for FHA refinance loans? This is an important question since your interest rate will affect the overall cost of your refi loan over time, and it’s good to know how rates work before you apply for a new home loan. FHA mortgage loan and refinance loan interest rates have a variety of factors that affect how they are determined for your loan. There is no single determining factor that allows a lender to give a single rate to all applicants-your interest rate is determined based on application data, market forces, and other factors. Does The FHA Set Interest Rates On FHA Refinance Loans? The FHA and HUD do not set or regulate FHA mortgage loan and refinance loan interest rates, except to require that the | more...

 
Can Disaster Relief Grants Be Used As Money To Close An FHA Loan?

Can Disaster Relief Grants Be Used As Money To Close An FHA Loan?

Can disaster relief grants be used as money to close an FHA mortgage loan? In the wake of the many natural disasters in 2017, many home owners in Texas, California, Puerto Rico, and other affected areas want to know what their options are to recover, rehab, repair, or replace their homes. FHA loan rules require the lender to verify the source of all funds used as a down payment on FHA mortgage loans; down payment money (also known as a Minimum Required Investment or MRI) cannot come from unsecured loans, gifts with an expectation of repayment, or other unapproved sources. The FHA loan handbook, HUD 4000.1, have rules for down payments that are sourced in whole or in part by disaster relief grants. But what does the FHA consider to | more...

 
Does The Age Of The Property Affect An FHA Home Loan?

Does The Age Of The Property Affect An FHA Home Loan?

Does the age of the property affect an FHA mortgage loan transaction? Not all properties are brand new, and in cases where existing construction homes or other property types are being considered for an FHA home loan, age can and often is a factor. Why is this? It depends on the type of home you wish to buy. FHA Home Loans For Mobile Homes, Manufactured Homes FHA home loan rules for mobile homes and manufactured homes carry a requirement that the property be of a certain maximum age. According to HUD 4000.1, the lender is tasked with insuring that the mobile home was built on or after June 15, 1976, “as evidenced by an affixed HUD Certification Label in accordance with 24 CFR § 3280.11”. The rules in this section | more...

 
FHA Home Loan Credit Checklist

FHA Home Loan Credit Checklist

There’s more than one kind of checklist that can help you in the FHA home loan process. There’s an overall mortgage checklist that helps people prepare for closing, but what about in the planning stages when you’re trying to review your credit to insure you are as credit-worthy as possible? Making a checklist specifically to review and prepare your credit is a very good idea, and you can get started with the following steps below. Making an FHA Home Loan Credit Checklist There are three very important areas to keep in mind when making a credit checklist; past credit performance, future credit activity, and the possibility of identity theft and/or outdated information on your credit report. Don’t overlook any of these areas, and be sure to develop a strategy for | more...

 
Bad Credit Scores And FHA Home Loans

Bad Credit Scores And FHA Home Loans

Bad credit scores and FHA home loans-do you know what the rules are for FHA credit requirements? FHA loan minimums and FHA lender standards may not be exactly the same, so it’s important to remember that the issues we discuss here are based around FHA minimum guidelines and that you’ll need to talk to a participating lender to see what other requirements must be met. Is There A Bad Credit FHA Home Loan? FHA loan rules require a 500 FICO score at the absolute minimum in order to qualify. Those who apply for an FHA loan with credit scores between 500 and 579 are required to make a higher down payment (10% of the adjusted value of the home) than those who apply with FICO scores 580 or higher. Remember, | more...

 
Is U.S. Citizenship Required For An FHA Home Loan?

Is U.S. Citizenship Required For An FHA Home Loan?

Is United States citizenship a requirement to be considered for an FHA mortgage? The answer may surprise you, but the FHA loan program is designed for a certain amount of flexibility, and the rules in this area are no exception. The rules governing this issue can be found in HUD 4000.1, the FHA loan handbook, which instructs the lender to request specific documentation including a potential borrower’s Social Security Number. According to page 131 of the handbook, “Each Borrower must provide evidence of their valid SSN to the Mortgagee.” FHA Loan Rules For Citizenship And Home Loan Approval According to HUD 4000.1, citizenship is not a prerequisite for FHA mortgage loan approval. However, borrowers will have to provide paperwork showing their status as either resident aliens or non-resident aliens. FHA | more...