April 8, 2020

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Articles Tagged With: APR (Annual Percentage Rate)

Mortgage Rate Trends

Mortgage Rate Trends: The Three Percent Range

Mortgage loan rates have been on a wild ride since the advent of the COVID-19 coronavirus outbreak; for a time FHA mortgage loan rates dipped below the three percent threshold. How wild has the ride been? FHA mortgage rates hit a 52-week range of rates between the lowest at 2.75% at the low point during the outbreak and just over 4% at its highest moment in the 52-week range. What does that mean going forward? For the average consumer, not much. It is pure speculation to say we may or may not see rates dip below the three percent range but borrowers should likely assume that those rock-bottom rates are gone and proceed without the temptation to float rather than lock in a mortgage rate commitment with the lender in | more...

 
FHA Rehab Loans In 2020

FHA Rehabilitation Loans In 2020

Are you interested in buying and fixing up a home, or refinancing and remodeling your current home? These are projects are possible in 2020 thanks to the FHA Rehabilitation Loan, also known as the FHA 202(k) Rehabilitation Loan or the refinance loan version of it. The FHA has a program that allows borrowers to apply for a mortgage loan in order to improve a property. The FHA 203(k) rehab loan is intended for borrowers who want to buy or refinance the property and do repairs, but not all borrowers have big rehab projects or work that requires a huge sum of money. Two Rehab Loan Options Open To You There are two different types of 203(k) loans-the “full” version is available for larger projects including work on loan-bearing structures, but | more...

 
FHA Home Loans And Interest Rates: What You Should Know About Low Rates

FHA Home Loans And Interest Rates: What You Should Know About Low Rates

At the time of this writing, what you should know about FHA Home loan interest rates includes the idea that interest rates at the moment are low for FHA mortgages, that the rates are subject to change, and that your credit report will play an important part in the rate you are offered. What do you need to know about FHA home loan interest rates in today’s housing market? FHA Loan Interest Rates Are Currently Very Low Some market watchers are quoting rates as low as 3.25%, and while that mortgage rate assumes a very well-qualified borrower, it is an indication of how low rates have gone in 2019. What’s good for the economy is often bad for mortgage loan interest rates, and the reverse can also be true. With | more...

 
Will My Home Loan Application Be Approved?

Will My Home Loan Application Be Approved?

Will my FHA home loan be approved? That is a common question for some borrowers who worry that their credit isn’t good enough for a home loan, and for borrowers who may have adverse credit information in their credit history. There is no single answer to this question since much depends on the borrower’s credit history, their patterns of credit use, debt ratios, and other factors. But in general there are some areas you can review to determine whether or not an FHA home loan is in your future. Will My Home Loan Be Approved? Occupancy Matters If you seek an FHA mortgage for a house that you (or at least one borrower obligated on the mortgage) do not intend to occupy as your primary residence, you will not be | more...

 
Preparing For An FHA Mortgage? What You Need To Know About "Contingent Liabilities"

Preparing For An FHA Mortgage? What You Need To Know About “Contingent Liabilities”

If you are preparing for a home loan and want to buy a primary residence with an FHA mortgage, you should know what the FHA loan rules are for “contingent liabilities” which involve the borrower. A contingent liability is a financial obligation that the FHA loan applicant has co-signed for in the past or is otherwise potentially responsible for should the main borrower default on the financial obligation. The FHA loan handbook defines contingent liabilities specifically as follows: “A Contingent Liability refers to a liability that may result in the obligation to repay only when a specific event occurs. For example, a contingent liability exists when an individual can be held responsible for the repayment of a debt if another legally obligated party defaults on the payment. Contingent liabilities may | more...

 
Does The Fed Interest Rate Cut Also Cut Mortgage Loan Rates?

What You Need To Know About FHA Home Loan Interest Rates

What does a new borrower need to know about home loan interest rates? There are many home loan blogs that discuss the fluctuations of mortgage rates and talk about those moves higher and lower. Some discuss the rates as though the ones mentioned could be offered to all applicants. Why isn’t this true? The rates you see advertised on the internet are usually posted as “best execution” interest rates which means that “ideal conditions” are assumed. What are those ideal conditions? An incredibly well-qualified borrower with high FICO scores, low debt ratios, and no credit issues. That means that the actual interest rate you are offered will vary from what you see posted online, and that the rate will depend on your FICO scores and other financial qualifications. But what | more...

 
FHA Home Loans And Interest Rates: What You Should Know About Low Rates

Who Decides FHA Loan Interest Rates?

Who sets FHA loan interest rates? The answer to that question involves several factors-many potential FHA borrowers asking this question really want to know more than who the regulatory body is for FHA loan interest rates-they also want to know how rates are affected by other factors such as FICO scores and credit history. So who DOES set FHA mortgage loan interest rates? According to the FHA/HUD official site, in general interest rates are set by the Federal Reserve Board. Furthermore, “HUD does not regulate the interest rate or the discount points that may be paid by you or the seller or other third party.” The official site adds, “You should shop around to be sure you are satisfied with the loan terms offered and with the service reputation of | more...

 
What is my FHA home loan down payment?

What Is An FHA Loan Rate?

What Is An FHA Loan Rate? Simply put, the FHA loan rate is the interest rate charged on your 15 or 30-year FHA mortgage. There are some facts you should know about FHA loan rates that will make understanding them much easier. FHA Loan Rates Are Set By The Lender Technically speaking, the mortgage loan interest rate on your loan is something you negotiate with your loan officer. Your access to the most competitive FHA loan rates will be determined by your FICO scores and other financial qualifications, but beyond that you may have the option to buy down interest rates using discount points, which is something you and the lender should discuss as early as possible in the loan process. We’ll come back to discount points in a moment, | more...

 

FHA Appraisal Timing: A Reader Question

A reader asks us a question about FHA appraisal rules this week in our comments section. “Buyers want my house but dont want to process the sale until the end of April. It is now Feb. 19th 2017. I dont have a problem with that but do want some kind of guarantee that they are going to buy it.” “They are going FHA. Should I ask them to have and pay for an appraisal & inspection now as a good faith issue? If I do hold the house for 2 months I am the only one to suffer if they dont buy. Also who does the appraisal and inspection if the loan is FHA?” As for the timing of the appraisal and home inspection, that would be up to the | more...

 

FHA Loan Mortgage Insurance Premiums

Here’s a version of a common question we’ve been asked recently about FHA mortgage insurance premiums: “I closed an FHA mortgage on a house I purchased in December 2014. The following month FHA reduced the mortgage insurance premium (MIP). Can I get the lower mortgage insurance rate and a reduced monthly payment without totally refinancing my mortgage?” The FHA/HUD official site published a .pdf file that addresses this question directly. Back in 2015 the FHA lowered it’s mortgage insurance premium. The pdf states, “The reduction is effective as of January 26, 2015. Borrowers with case numbers assigned on and after January 26, 2015 will be eligible for reduced annual mortgage insurance premiums.” Note the specific date when the lower premiums become effective-borrowers who have loans prior to these dates will | more...