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Articles in Category: FHA Requirements

FHA

FHA Home Loan Mistakes To Avoid

Many people have checklists to help them shop for a home, apply for a mortgage loan, and close the deal. But is your house-hunting checklist really complete without adding a list of mistakes to avoid? Steer clear of these common errors some home buyers make, and you will save yourself time and money. FHA Loan Mistakes: Not Getting Pre-Approved For A Home Loan If you get pre-approved for a home loan, the seller of the property you decide to buy (or the real estate agent, or both) will know you are a serious buyer. Those who are in the window shopping phase of their home loan process aren’t take as seriously by a seller or RE agent, and in some cases not having pre-approval may exclude you from looking at | more...

 
FHA loans

FHA Home Loan Approval Versus Your Debts

In 2024, a successful FHA home loan application means taking some extra time in the planning stages to work on your financials including your credit scores and the amount of debt you carry. Some borrowers don’t view those two issues as being equal…at first. FHA Loan Approval Factors You Should Know Your FICO score range is an important part of the data your lender uses to justify approving your mortgage. But it isn’t the only benchmark. Did you know that to be approved for an FHA mortgage, try to come to the loan application process with a debt ratio of 43% or less? That means your monthly outgoing debt takes up no more than 43% of your monthly income. Managing Your Debt Ratio: How To Get Started The Consumer Financial | more...

 
FHA Loans

Is The Housing Market Entering A Recovery Phase?

After briefly approaching the 8% home loan interest rate range, sources (including real estate company Redfin and NBC.com) report December 2023 conditions might be an indication of a housing market recovery or turnaround. Both NBC and Redfin report home loan interest rates falling to just over the 7% mark after hitting 8% in October 2023. Rates had formerly not reached those highs over two decades. According to NBC News, “The interest rate on a 30-year fixed mortgage is down to 7.03%”, with mortgage applications up by roughly 15%. That after reaching major lows in the previous month. Housing Market Recovery Signs Home loan applications may rise in 2024. Consumers may feel freer to apply, based on a perception that things are improving. Another factor that could be informing higher application rates? | more...

 
FHA Loans

How Long It Takes To Be Approved For A Mortgage

Getting approved for a home loan can take a few weeks or months, depending on the borrower and the circumstances surrounding the loan. Receiving the FHA loan funds may take between four weeks and 90 days from start to finish, and there are milestones along the way, such as the appraisal process, which must be passed before loan funds can be released. Here is what you need to know about the time it takes to be approved for a mortgage. A Process With Multiple Stages Your FHA loan has more than one milestone to pass before you reach closing day and accept your keys. There’s the pre-approval stage, the appraisal, any required compliance inspections (where applicable) and getting the loan itself approved. Did you know your lender may check your | more...

 
credit reports

Home Loans and Your Credit Scores

FHA mortgages (including purchase loans, One-Time Close construction loans, and FHA condo loans) have more forgiving credit score requirements for loan approval than some conventional mortgages, but you still need to work on your credit at least 12 months ahead of your home loan application for best results. But some aren’t sure what scores to aspire to. Many finance blogs have varying advice on what to do about your FICO scores if they aren’t in the good or excellent range.  But what do the major credit reporting agencies like TransUnion or Equifax say about “good” FICO scores? How do the bureaus interpret the numbers? Experian’s Good FICO Scores Experian notes, “To increase your odds of approval and qualify for a lower-rate mortgage, you should aim to have a credit score | more...

 
FHA Loan

Home Loans And Your Credit Scores

What can borrowers expect from an American economy trying which is STILL in the process of recovering from the negative financial effects of COVID-19? Some experts are currently talking about the minor gains in mortgage rates and interest rates falling overall but are quick to point out that those with FICO scores below the lender’s typical approval range are experiencing more costly loans. Some house hunters may find it harder to qualify even as rates seem to be cooling somewhat. And certain types of home loans such as cash-out refinances aren’t even on the table for some borrowers until rates cool off even more. What does all this mean for a borrower who isn’t even ready to get pre-qualified yet? The future promises to be unpredictable, financially speaking. We are | more...

 
FHA loans

Avoiding Foreclosure in 2024

Do you want to buy or build a home with an FHA loan? When planning and saving, consider what happens after closing day once you accept the keys, schedule the movers, and take possession of your new house. What’s the big issue to remember here? Future borrowers in the budgeting and planning stages must choose how much cash to pay at closing time. And so far out from that first mortgage payment it may feel tempting to save a bit on your out-of-pocket expenses and finance certain closing costs like the FHA loan upfront mortgage premium. There is an issue called “cost creep” that some borrowers may experience. Financing one closing cost might not hurt your bottom line too much. And from there some justify adding even more to the | more...

 
FHA Home Loan

FHA Loan Limits For 2024

In the last week of November 2023, new FHA loan limits were issued for 2024. Those new limits (see below) are for forward mortgages approved under the FHA Single Family Home Loan program. Higher FHA Loan Limits In 2024 FHA loan limits increase for a large number of applicants in 2024. HUD.gov says the limits will increase for most of the country, and a HUD press release says that FHA loan limits are increasing at least in part due to increases in property values in 2023. That’s according to Assistant Secretary for Housing and Federal Housing Commissioner Julia Gordon. The changes to FHA loan limits are meant to help buyers to find affordable homes, “at a time when a lack of affordability threatens to shut well qualified borrowers out of | more...

 
FHA mortgage

Planning A Mortgage: Credit Resources You Need

Are you planning a home loan? Are you in the budgeting and saving stages of your home loan journey? If so, there are some necessary resources you should explore before you apply for an FHA mortgage. It’s important to give yourself enough time to plan and save for your home loan and that includes paying more attention to and working on your credit. Credit resources can be a huge help in this regard–don’t pass on the chance to improve your FICO scores, get your payment history into good shape, and prevent identity theft or other problems from stopping your mortgage loan in its tracks. The first resource you should consider is the offer made by the FHA and HUD to give free referrals to a HUD-approved housing counselor. You can | more...

 
Home Loan Prep: Credit Issues

Before You Apply For Your Home Loan

First-time homebuyers are often encouraged to start planning and saving for an FHA loan at least 12 months ahead. And it’s good advice. Within those 12 months, you’ll want to concentrate on a few important areas. There are moves to make and moves to avoid in the 12 months before your home loan application. 12 months is just a baseline. Some prefer to take 18 months or longer to prepare for a mortgage application. Take as much time as you need for best results. Don’t Make Big Career Changes Too Close To Application Time For the purposes of this article, pay raises, promotions, or other upwardly mobile moves within the company you currently work for are not the issue.  Switching to a freelance career, transitioning from full-time to contract work, or | more...