August 19, 2017

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Articles in Category: FHA Loan Basics

Can I Get A Second FHA Appraisal?

Can I Get A Second FHA Appraisal?

Can I get a second FHA appraisal? There are a few reasons why a borrow might feel motivated to ask that question, but in many cases it could be due to a disagreement about the outcome of the original FHA appraisal. Ordering A Second FHA Appraisal FHA loan rules in HUD 4000.1, the FHA single-family home loan handbook, clearly state the FHA’s position on ordering second appraisals due to a dispute over the outcome. “The Mortgagee is prohibited from ordering an additional appraisal to achieve an increase in value for the Property and/or the elimination or reduction of deficiencies and/or repairs required.” That is simple enough. However, there may be situations where one party to the loan feels that the appraisal was not done competently or that the appraisal is | more...

 
Where can I get an FHA loan?

Where Can I Get An FHA Loan?

Where can I get an FHA loan? There are plenty of options when you are ready to begin your journey to become a home owner-you can apply in person, or get pre-qualified or apply online. How does it all work? Who Offers FHA Home Loans? FHA mortgages are offered by participating lenders who have been approved by the FHA to offer FHA mortgages, refinance loans, FHA Reverse Mortgages, and rehab loans. The FHA itself does not loan the money for you to purchase your home. The FHA may require the lender, depending on circumstances, to work with the FHA to approve certain home loans, but many FHA lenders have earned the right to offer loans “unsupervised”, meaning they have met standards that permit them to make decisions on loan approval | more...

 
How much can I borrow with an FHA refinance loan?

How Much Can I Borrow With An FHA Refinance Loan?

How much can I borrow with an FHA refinance loan? There are many reasons why a borrower might need to know early in the planning stages how much might be allowed, and knowing the FHA loan rules in this area can definitely help save time before you apply for the loan. Knowing what kind of refinance loan you might need is a big help in answering the question. Why? Because the actual dollar amount for some FHA refi loans may vary for the same property depending on circumstances. The amount of an FHA rehab loan, for example, will be higher since there are laborers and materials to be paid for, inspections, etc. The same home that gets an FHA Streamline Refinance loan instead might have a lower dollar amount depending | more...

 
What are the differences between FHA loans and conventional mortgages?

What Are The Differences Between FHA Mortgages And Conventional Loans?

What are the differences between FHA loans and conventional mortgages? That’s a very good question, and one that has a multi-faceted answer. Borrowers could find that with careful planning, the amount of mortgage debt with an FHA mortgage is lower than with some conventional equivalents. The most basic difference between FHA mortgages and conventional home loans is that conventional loans are not backed in any way by the United States government, while FHA loans are guaranteed with government funds. This makes FHA loans easier to get since there is less risk to the lender. FHA loans differ from conventional loans in a variety of other ways, as we’ll examine here. Lower Interest Rates Interest rates on FHA mortgage loans are lower than conventional mortgages. You can easily verify this by | more...

 
How Do FHA Loan Appraisals Work?

How Do FHA Loan Appraisals Work? Part Two

FHA loan appraisals are a big part of the FHA loan approval process. Without the appraisal, your home loan application cannot move forward. The FHA appraiser compares the home you want to buy with an FHA loan to similar properties on the market and reviews the condition of the home to make sure it meets FHA minimum standards. Once the value of the home has been established, your lender can determine what your FHA loan amount should be, factoring in the amount your required down payment, plus the amount of any extras you choose to have financed into the loan (such as the Up Front Mortgage Insurance Premium). The FHA appraiser will visit the property-there is a requirement that the appraiser be physically present-to look at the home inside and | more...

 
How do FHA loan appraisals work?

How Do FHA Loan Appraisals Work?

How do FHA loan appraisals work? This question is a vital one because some get the appraisal process confused with a home inspection and the two are not the same. The importance of an FHA appraisal in your loan process has to do with the lender getting information that helps calculate the fair market value of the home, while the home inspection gives the borrower information needed to make an informed purchase. FHA appraisals are governed by the rules in the FHA loan handbook, HUD 4000.1, which says the lender is required to, “order an appraisal from an Appraiser who is listed on the FHA Appraiser Roster and is qualified and knowledgeable in the specific market area in which the Property is located. The Mortgagee must evaluate the Appraiser’s education, | more...

 
What Can I Rehab With An FHA 203(k) Mortgage?

What Am I Allowed To Rehab With An FHA 203(k) Mortgage?

In our last blog post, we discussed what is permitted under the FHA 203(k) rehab mortgage loan. Borrowers are allowed to apply for a new purchase loan or an FHA refinance loan under the 203(k) program, which the FHA loan handbook describes as being used to do the following: – rehabilitate an existing one- to four-unit Structure, which will be used primarily for residential purposes; – rehabilitate such a Structure and refinance outstanding indebtedness on the Structure and the Real Property on which the Structure is located; or – purchase and rehabilitate a Structure and purchase the Real Property on which the Structure is located. According to HUD 4000.1, “Structure” is defined as, “a building that has a roof and walls, and stands permanently in one place that contains single | more...

 
Can my seller pay some of my closing costs?

How Do You Get An FHA Construction Loan?

How do you get an FHA construction loan? This question isn’t as simple as it sounds, but those who want to have their new home built for them instead of purchasing existing construction properties will find that FHA mortgages for new construction are possible with a bit of extra effort. The first step toward getting an FHA construction loan is to find a participating FHA lender willing to offer them. Not all FHA lenders will offer construction loans, so you’ll need to shop around to find the right lender for you. There are two basic types of FHA construction loans-a “traditional” construction loan, and an FHA One-Time Close loan. Your participating lender may offer one, or both types-it’s best to discuss this as early in the process as possible since | more...

 
Where can I refinance an FHA loan?

Where Can I Refinance An FHA Loan?

Where can I refinance an FHA loan? Many want to know what their FHA refinance options are, but there are some misconceptions about refinancing that should be cleared up so borrowers understand all their options and not just the most obvious choices. For example, did you know you can refinance an FHA mortgage loan without an FHA-required credit check? (More information on that transaction is below.) The most basic answer to the question is that you may refinance an FHA mortgage at any participating FHA lender who offers the type of refinancing you seek, and your options may include loans that feature cash back, those which have no cash back permitted but allow a no-credit-check transaction, etc. But there’s more to this issue than just who and where you choose | more...

 
What can I add to my FHA mortgage loan?

What Is An FHA Construction Loan?

The FHA single family loan handbook tells us that FHA home loans are for a variety of different types of purchases including existing construction, “new construction” which means a home recently built but never occupied by an owner, and “proposed construction” loans which allows the buyer to apply for a loan to fund both the construction phase and the “permanent” phase of the mortgage. How do FHA construction loans differ from new purchase loans? Aside from the obvious (new purchase loans for existing construction move faster than construction loans do thanks to the lack of a construction phase for the existing construction loan) there are some important considerations to think about when contemplating your construction loan options. Is An FHA Construction Loan Right For Me? If you need to get into | more...