August 21, 2018

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Articles in Category: FHA Loan Basics

FHA loans after Chapter 13 bankruptcy

FHA Loan Down Payment Assistance Rules

FHA loan rules governing down payments and down payment assistance are found in HUD 4000.1, the FHA single-family loan handbook. FHA loan rules require both a minimum down payment and also that the down payment comes from an approved source. FHA loan rules permit borrowers to get down payment assistance from third parties, but when down payment help is offered, it must meet the same types of requirements that borrower-provided down payment funds. What are the rules for down payment assistance for FHA mortgages? FHA Home Loan Down Payments Must Be Sourced Properly FHA loan down payment money can come from a borrower’s cash reserves, cashed-in investments, checking accounts, and a variety of other sources. But it cannot come from a payday loan, cash advance, or other restricted sources. The | more...

 
FHA Home Loan Options You Should Know About

FHA Home Loan Options You Should Know About

Do you know all your FHA home loan options? There are important choices to make that can affect your monthly payments, the amount of down payment money you bring to the transaction, and even whether your home loan is a fixed rate mortgage or an adjustable rate loan. FHA Home Loan Options: Down Payment Assistance The FHA loan program itself does not offer down payment assistance, but permits contributions of gift funds and down payment help that meets FHA loan rules. Third parties such as government agencies or charitable organizations may be able to help with your down payment if you meet the program’s requirements. Gift funds can come from a relative or other third party but all funds for down payment must be carefully documented and verified by the | more...

 
Why Get Pre-Approved For An FHA Home Loan?

Why Get Pre-Approved For An FHA Home Loan?

Why get pre-approved for an FHA mortgage? This is a question some first-time home buyers ask, and the answers can make a big difference in how you approach your home loan. FHA Home Loan Pre-Approval Does Not Commit You To A Mortgage When you fill out the forms to be pre-approved for a home loan, you are not committing to the transaction in the sense that you would be financially obligated to buy. The borrower is not legally committed to a purchase when getting pre-approved. Home loan pre-approval actually works to help you be taken seriously as a buyer when you do find a home you’re ready to commit to. The buyer takes a pre-approved borrower more seriously and you may find that a pre-approval letter (depending on the housing | more...

 
FHA Home Loans And The Accuracy Of Your Credit Data

FHA Mortgage Loans And Your Monthly Mortgage Payment

What should all borrowers know about FHA mortgage loans and the monthly mortgage payment? Up to the time of FHA home loan approval, borrowers know they need 12 solid months of on-time payments on all financial obligations, avoid running up credit card debt, and avoid opening new lines of credit. But what happens after the home loan is approved? Borrowers are encouraged to be mindful of their mortgage payments on the FHA loan in the same way as they have been careful to make those on-time payments in the year leading up to FHA loan approval. Why is continuing to pay on time even after loan approval and the closing date so critical? In short it’s because a borrower may wish to refinance her mortgage loan at some point and | more...

 
Am I Required To Use Water Utilities For The Home I Buy With An FHA Mortgage?

Am I Required To Use Water Utilities For The Home I Buy With An FHA Mortgage?

Not all properties are created exactly alike. Some are hooked up to the local utility company for drinking water and septic, while others may rely on wells or other sources. FHA borrowers considering the purchase of a property served by a well often worry that the home won’t meet FHA minimum standards. What do FHA loan rules say about home loan approval for a property served by a well and/or a water purification system? For a start, FHA loan rules do not automatically deny FHA loan approval for properties that have a well or a water purification system rather than being served by a local utility company. That said, HUD 4000.1, the FHA loan handbook, does require that properties purchased with an FHA loan use local water utility systems “wherever | more...

 
When Is An Appraisal Required For An FHA Home Loan?

When Is An Appraisal Required For My FHA Mortgage Loan?

When is an appraisal required for an FHA home loan? This important question often comes up when borrowers want to refinance a home using an FHA refinance loan such as cash-out refinance, FHA Streamline Refinance, or even when the borrower wants to apply for an FHA Reverse Mortgage. Appraisals are required for most FHA loan transactions-you will always have to pay for an appraisal for an FHA forward mortgage, which is the kind of loan you will apply for when purchasing a new home. Appraisals are required for both existing construction loans and FHA One-Time Close construction loans, though the process will vary for construction loans due to the nature of the transaction. Appraisals will also be required for FHA Rehab loans. The appraisal is intended to establish the fair | more...

 
Before Your FHA Home Loan Closing Date: What You Should Know

FHA Home Loan Questions And Answers About The Appraisal Process

The FHA loan appraisal process is potentially confusing to a new borrower. If you are serious about purchasing a specific property with an FHA mortgage, the appraisal is an important step in the loan approval portion of your house hunting experience because it tells the lender whether the property is suitable for an FHA mortgage. What Is The FHA Appraisal And What Does It Do? FHA appraisals are performed when you want to purchase a specific property with a home loan. The appraisal is not done for a house you are “just looking” at; this process is reserved for the home you specifically want to buy. An FHA approved appraiser, assigned by your lender, will come to the property and give it a general review. This process is not as | more...

 
Who Needs Credit Repair Before Applying For An FHA Mortgage?

What Does It Mean To Get An FHA Mortgage Loan Case Number?

For those new to the home loan process, or just new to FHA mortgage loans, the question, ‘What Does It Mean To Get An FHA Mortgage Loan Case Number?” is a good one to ask. What is this process and how does it work? It does not matter if you are applying for an FHA 203(k) rehab loan, a typical new purchase FHA mortgage, or even an FHA One-Time Close construction loan; when a borrower is serious enough to start the loan application paperwork the FHA case number process will begin. HUD 4000.1, the FHA Loan Handbook, says an FHA case number is ordered by the lender when there is an active mortgage loan application for the property a borrower wants to purchase. What is required of the borrower to | more...

 
Five Questions People Ask About FHA Home Loans

FHA Home Loan Issues For Veterans

Veterans interested in buying a home have many choices including a VA home loan, but also FHA loans that function in much the same way as their VA counterparts. While it is true that VA loans require no down payment in most cases but FHA home loans always require one in most cases, some veterans explore their FHA loan options just the same. Some want existing construction loans, others want a One Time Close mortgage to build a suitable home from the ground up. One Time Close mortgages are available in both VA and FHA versions, so military and veteran borrowers have options with either type of mortgage. But some military members and veterans may enter the service after already having purchased a home, or after having assumed an FHA | more...

 
Can I Make My FHA Home Loan Down Payment In Cash?

FHA Loan Rules For Appraisals: What Borrowers Need To Know

What do borrowers need to know about FHA loan appraisal rules? We field reader questions every month that include queries about the appraisal process and whether or not a certain type of condition is permitted in a home to be purchased with an FHA mortgage. Some recent reader questions go along these lines: “Is an unfinished basement acceptable in a home I’m buying with an FHA mortgage?” “Does the garage have to be wired for electricity in order to be approved for an FHA loan? and, “The home I want to buy is served by a well instead of being connected to a local utility. Is this permitted?” There are some FHA loan rules for appraisals that may address some or all of these issues, but there’s a very important | more...