April 18, 2019

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Articles in Category: FHA Loan Basics

FHA Home Loan Facts

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 For Millennials

FHA Home Loans For Millennials

How young is too young to buy a home? Millennials are taking over as the largest group of home buyers in the United States, but some wonder whether they are able to qualify. What does it take to qualify for an FHA mortgage? Are There Age Restrictions On FHA Home Loans? FHA loans do require all borrowers to be of sufficient legal age to sign legally binding contracts. But aside from that, there are no real age limits for FHA mortgages with one exception. The FHA Reverse Mortgage, which lets qualified borrowers convert the equity in a home they own outright into cash, is limited to borrowers aged 62 or older. But for forward FHA mortgages to purchase a home, as long as the borrower is otherwise qualified and of | more...

 
FHA Home Loan Options For First-Time Home Buyers

House Hunting Advice For First-Time Home Buyers

When you start making plans to work with a realtor, there are some very good things to consider ahead of time. Checklists, online mortgage calculators, and other home buying tools are only some of the things you’ll want in your house hunting toolkit when you are ready to become a home owner. Decide What Your Priorities Are For Your New Home Before you ever fill out FHA home loan paperwork, and long before you decide which real estate agent to work with, you should have an idea of what your main priorities are for your new home. Do you need a home located near a certain school or type of school? Are you looking for some place quiet and residential and nowhere near a shopping mall, gas station, or movie | more...

 
First-Time Home Buyer Advice: Get A Home Inspection

First-Time Home Buyer Advice: Get A Home Inspection

Some wonder if they have had a home inspection when the FHA appraisal results come back. First-time home buyers should know that a home inspection is something that should be done regardless of the appraisal because the two procedures are quite different. The appraisal is not a tool for the borrower and will not give you an idea of the true condition of the home. The home inspection is the job that needs to be done to give you that information. The FHA itself publishes a pamphlet called “For Your Protection, Get A Home Inspection” which includes this advice; “You have the right to examine carefully your potential new home with a professional home inspector. But a home inspection is not required by law, and will occur only if you | more...

 
What You Need To Know About Home Loan Appraisals As A First-Time Home Buyer

What You Need To Know About Home Loan Appraisals As A First-Time Home Buyer

What do first-time home buyers need to know about real estate appraisals when it’s time to make an offer on a home? Your real estate agent and lender know the power of the appraisal-do you? FHA Home Loans Require An Appraisal For Most Transactions There is only one kind of FHA mortgage loan that has no FHA-required appraisal, called the FHA Streamline Refinance loan. All others will need an appraisal to determine the fair market value of the home. The Appraisal Is A Tool For The Lender Borrowers should not use the appraisal to determine whether the home has defects or hidden problems. No matter what you may be told by others, the appraisal process is not intended to help the borrower decide whether or not the home is ok | more...

 
FHA Home Loans and Help With Down Payments

FHA Home Loans and Help With Down Payments

First-time home buyers looking for real estate to buy with an FHA loan may be intimidated by the notion of saving up for and making any kind of down payment, let alone a percentage of the appraised value of the home. But it’s important to remember that borrowers have options with FHA mortgage loans that can help offset the down payment. A Wall Street Journal report from January 2019 discusses “the bank of Mom and Dad” as one of the most influential factors in home buying. Did you know that according to the Wall Street Journal, approximately 26% of the FHA loan transactions included financial help from parents? The Bank Of Mom And Dad can be a powerful factor in buying a first home. But some first-time home buyers aren’t | more...

 
Buying A Home With An FHA Mortgage Versus Renting

Buying A Home With An FHA Mortgage Versus Renting

How much money do you spend renting a home instead of owning one? If you count the security deposit, any applicable pet deposit, and other expenses, the numbers can add up quickly. When you rent a home instead of buying real estate with a mortgage loan, you are also stuck with whatever appliances your landlord has seen fit to install in the home, regardless of quality. You have to live with someone else’s interior design and paint scheme preferences, and chances are the carpet is not what you would have chosen…at all. Renting A Home: Where Are The Long-Term Financial Benefits Compared to Home Ownership? When you rent, you get no equity, no cash-out refinance loan option, and no ability to sell the home at a higher price than you | more...

 
Preparing For A Home Loan As A New Borrower

Preparing For A Home Loan As A New Borrower

Preparing for a new home loan requires time. Before you start looking at real estate listings, talking to sellers, or begin filling out loan paperwork, you will need to take several steps ideally started at least a year before you begin house hunting. Begin Saving For Your Down Payment And Other Expenses Now There are appraisal fees, home inspection expenses, possible flood zone determination costs depending on location, closing costs, and the down payment to think about. Start saving as early as possible for these expenses. Start Checking Your Credit Reports Now If you find any items on your credit report that need to be disputed, the process can take many months. Don’t wait until later to take this step, the time you save will be critical later. You do | more...

 
FHA Home Loan Rules For Sellers

FHA Home Loan Rules For Sellers

What do sellers need to know about FHA home loans? There are several areas that you should know when negotiating with a first-time home buyer or an experienced real estate owner. One excellent example; when the home is appraised for an FHA mortgage loan, if the appraisal values the home at a dollar amount lower than the sale price, the borrower cannot be forced to complete the transaction. She has the option to walk away from the loan. This option is described in HUD 4000.1 which instructs the lender that a clause must be inserted into any sales contract involving an FHA mortgage that includes the following; “It is expressly agreed that notwithstanding any other provisions of this contract, the purchaser shall not be obligated to complete the purchase of | more...

 
Why You Could Buy A First Home With An FHA Mortgage

Are The Same FHA Home Loans Offered To A First-Time Home Buyer As Experinced Borrowers?

There are plenty of misconceptions about the FHA home loan program and first-time home buyers may assume some of them are true. One such misconception is that the FHA home loan program is only for first-time home buyers. Another is that the FHA loan program offers perks for those who are searching for their first home or a starter home. The reality is much different. Three Things First-Time Home Buyers Should Know About FHA Loans FHA home loans are not need-based mortgages, though many who need affordable down payments and the ability to refinance later into a lower mortgage payment choose FHA mortgages for the flexible credit guidelines and other factors. Down payment assistance may be available in your local area. However, the FHA itself does not offer any such | more...