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Articles in Category: FHA Guidelines

FHA Home Loan

Things That Keep You From Getting An FHA Mortgage

What keeps some borrowers from getting an FHA home loan or refinance loan? In some cases the answers are easy, in others they are more complicated. Learn what some of the red flags are for lenders and prepare yourself to get the FHA home loan you need. Automatic Denial Of FHA Home Loans: When Does It Happen? FHA home loans are automatically denied for a variety of reasons. Borrowers with FICO scores lower than 500 are automatically denied, as are borrowers who have applied for a mortgage while they are in a bankruptcy that has not been discharged yet. U.S. citizenship is not required for an FHA home loan, but those who apply without legal standing of some kind (anyone in the country illegally) is automatically turned down for the | more...

 
FHA Home Loan

Can I Use An FHA Loan To Buy A Single Family Rental Home?

Some FHA borrowers want to purchase a first home, while others are looking for real estate they can purchase in addition to an existing property. But still others are wondering if they can use an FHA mortgage loan to become a landlord by purchasing real estate they intend to rent out to others. Does the FHA home loan program allow a borrower to apply for a mortgage loan to buy a home intended as a rental? The short answer is that it depends greatly on two factors-the size of the home and whether the borrower intends to live in that property full-time. Borrowers applying for FHA mortgages are allowed to purchase real estate with one to four units. The borrower is free to rent out the unused units in the | more...

 
FHA/HUD

HUD Announces Changes To Down Payment Assistance Rules

The Department of Housing and Urban Development and the FHA have issued a Mortgagee Letter announcing changes to the rules for down payment assistance. FHA loan program rules permit the borrower to get assistance with the minimum required down payment-this assistance can come in the form of gift funds from family or friends, money from employers, or even down payment assistance programs. Government entities are permitted to provide such down payment help, too. In all cases, the down payment assistance must meet FHA loan requirements. Gifts cannot be loans in disguise; there must be no expectation of repayment of a gift of down payment funds. And now, thanks to revisions to the rules governing these issues in HUD 4000.1, government entities must meet certain requirements when providing down payment funds. | more...

 
FHA home loans

FHA Loan Facts

When you start doing research on home loans and want to learn what it takes to qualify for an FHA mortgage loan as either a first-time home buyer or as a return borrower, you will find websites with lists of loan approval requirements. Some of those FHA home loan approval requirement lists look like this: A credit score of 580 or higher for the lowest down payment A debt-to-income ratio of 43% or less 3.5% down payment 1-2 years of consistent employment history A property that meets FHA standards OR A home eligible for FHA 203k rehab loan financing You may find a caveat on lists like these stating that they are “general guidelines” and that is true. What isn’t always included in those caveats is that additional lender standards | more...

 
FHA home loans

FHA Home Loan Appraisal Issues

We are contacted frequently with questions related to FHA appraisals. Many first-time borrowers and experienced house hunters alike have trouble understanding the nature of the appraisal process and how it works. We are often asked if a certain appraisal condition is grounds for having the loan denied, and whether FHA home loan appraisal rules fit a unique circumstance. But whatever the question, the variable in the equation is the fact that FHA appraisal rules, which are basically minimum requirements, are not the only rules that will affect the transaction. So even if FHA appraisal requirements say that a home that has lead-based paint may be acceptable under certain conditions, state or local building code may have additional requirements. And the building code requirement in that area would have to be | more...

 
FHA loans

Five Things You Should Do Before Applying For Your First Home Loan

First-time home buyers should be working on five areas before they apply for a mortgage loan. Are you working with a real estate agent or searching the real estate listings in your local area? Maybe you want to buy a new home in a different area than where you are living now and need to know the ins and outs of the neighborhoods there? Decide What Kind Of Home Loan You Need Having a home built from the ground up is possible with an FHA One-Time Close Construction Loan, but these loans are quite different than an FHA Condo Loan or FHA loans for a mobile home or manufactured home. Knowing the kind of loan you want in advance will help you search for the right kind of lender-some financial | more...

 
FHA And HUD

FHA And HUD Announce Home Loan Policy Changes

The Department of Housing and Urban Development has announced policy updates and changes that have been added to the FHA Single Family Home Loan Program Handbook, HUD 4000.1. According to an FHA/HUD press release, these are the first changes and updates to the handbook since late 2016. “With today’s update, FHA is recommitting to the industry that it will continue to maintain and enhance the SF Handbook so that it becomes a single, comprehensive source of policy guidance for lenders and other stakeholders doing single family business with FHA” according to the press release. The updates, posted March 27, 2019, include a set of “technical changes for consistency and clarity” as well as FHA home loan program policy updates. These updates affect how the lender may handle certain issues associated | more...

 
FHA home loans

FHA Home Loans For Homes Built Before 1978

FHA home loans are offered for a variety of home needs including building a house from the ground up with an FHA One-Time Close construction loan, but there is also an option to use your FHA mortgage to buy an older home that is not considered new construction. In cases where the property is older than 1978, there are some additional rules regarding the potential for lead paint in the residence that all borrowers thinking about buying older property should be aware of. FHA home loan rules in HUD 4000.1 point out that any home built prior to 1978 must include disclosures to the buyer: “…the seller must disclose any information known about lead-based paint and lead-based paint hazards before selling the house, in accordance with the HUD-EPA Lead Disclosure | more...

 
FHA loans

How Do I Refinance My Home Loan?

Are you planning to buy your first home and wondering about your refinance loan options later down the line? Do you already own a home you need to refinance? There is good news for you; refinancing with an FHA mortgage can help you get into a lower mortgage payment, get out of an adjustable rate mortgage, or even renovate your house. What does it take to refinance a home loan with an FHA mortgage? Choose The Refinance Loan You Need There are several FHA refinance loan options. If you need to remodel or repair your home at the same time you refinance, you can apply for an FHA 203(k) rehab loan that provides funds for approved upgrades and improvements. But the FHA rehab refinance loan (which is also available as | more...

 
FHA

FHA Home Loan Approval Rules You Should Know

If you are a first-time home buyer or have never used an FHA home loan before, there are some rules about FHA mortgages you should know before getting started. FHA Home Loan Approval Depends On More Than Your Credit Score It’s easy to fixate on credit scores and they are a major part of what your lender will use to determine a borrower’s creditworthiness. But it’s not the only criteria. Your income, employment, and credit habits will all be examined at home loan application time. FHA loan rules specifically require the lender to verify two years of employment, and that employment does not have to be with the same company. The rules also require your lender to determine that your income is likely to continue. But this is possible even | more...