Articles Tagged With: FHA Home Loans

June 27, 2019

You Are Not Ready For An FHA Home Loan If…

How do you know you are truly ready for a home loan? There are many things to consider, including your finances, credit, and employment history. But there are other factors, too. You Are Not Ready For An FHA Mortgage If You Don’t Know How Much You Can Afford To Pay Each Month Do you know how much you can afford in a monthly mortgage payment? Don’t forget that calculating your payment isn’t as simple as doing the math on the sale price of the home compared to the length of the mortgage plus interest. You will also have to figure in property taxes, any applicable homeowners or condo owners association fees, mortgage insurance premiums, and other factors. Do not overlook these expenses when doing the mortgage math! You Are Not | more...

April 22, 2019

Lower Home Prices And FHA Mortgages

By Joe Wallace

House prices in 2019 seem to be “at risk” to go lower according to some industry reports. If you are researching home prices (especially for those in housing markets on the West Coast) you may read about these issues being higher than usual for a variety of reasons. How Do Declining Home prices Affect FHA Home Loans? If the value or asking price of a neighborhood is in decline, it may affect certain options you have to negotiate with the seller. Your seller may or may not be willing to negotiate on items like the allowable six-percent-of-the-sale-price contributions toward closing costs the seller can make. Sellers may agree to pay this six percent as an incentive for the borrower to purchase the real estate. But if prices are going down | more...

April 18, 2019

Home Flipping And FHA Mortage Loans: The Rules

By Bruce Reichstein

A 2019 CoreLogic report states that home flipping, the process of purchasing, renovating, and putting a house back on the market in a short period of time and often at a substantial markup, is at it’s highest levels in about eight years. The CoreLogic report states, “…since the Great Recession, flippers have been increasingly good at acquiring properties at a discount, either because the properties were legally, financially or physically distressed”. Some borrowers may be tempted to flip homes, and others may wish to purchase a flipped home. What does the FHA home loan program’s rulebook say about this practice? HUD 4000.1 states that “eligibility of a Property for a Mortgage insured by FHA is determined by the time that has elapsed between the date the seller has acquired title | more...

March 27, 2019

FHA Home Loans For Millennials

By Joe Wallace

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...

HUD Releases Housing Reform Recommendations

February 13, 2019

Will Another Government Shutdown Affect First-Time Home Buyers Applying For FHA Mortgage Loans?

By Joe Wallace

While threats of another government shutdown seem to be on-again, off-again, some potential FHA borrowers are wondering if there will be a repeat of the stalemate that brought the longest government shutdown in recent memory. And will FHA home loans be available to first-time home buyers if the whole affair repeats itself again? FHA Mortgage Loans Will Still Be Available During The Government Shutdown The kind of loan you buy a home with, FHA forward mortgages, will continue to be serviced during a possible shutdown as previously reported here and elsewhere, as discussed in the HUD/FHA contingency plan released prior to the last shutdown. Reverse mortgages, on the other hand, may once again be completely unavailable during the shutdown. FHA loans that cannot be processed using automated means-those that require | more...

Real Estate, Millennials, And Down Payments

January 19, 2019

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

By Joe Wallace

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...

January 15, 2019

First-Time Home Buyer Advice: How To Buy Your First Home With Less Cash Up Front

By Bruce Reichstein

First-time home buyers often need to save as much cash up front on the transaction as possible. There are ways you can prepare for your FHA home loan in the planning stages that can help you buy your first home with less out-of-pocket costs. Do you know what they are? First-Time Home Buyers Should Work On Lowering Credit Card Balances Very Early Whenever Possible One very important factor in qualifying a borrower as a good credit risk when buying a first home? The amount of debt the first-time borrower carries versus the amount of monthly income. Your debt ratio is just as important as FICO scores, and the lower your debt ratio, the better off you will be when the lender goes to approve or deny the home loan application. | more...

Build on your own land FHA One Time Close Construction Loan

November 20, 2018

One-Time Close FHA VA USDA Construction to Permanent Financing

By Bruce Reichstein

There is a type of home loan borrowers can apply for when they want a house built for them from the ground up. These mortgages are known as One-Time Close loans and are offered by the VA, USDA, and FHA programs via a participating lender. Do you prefer to have a home built just for you rather than purchasing someone else’s property? What Are FHA Construction Loans? The FHA construction loan known as a One-Time Close (OTC) mortgage, like its’ USDA and VA counterparts, offers qualified borrowers a single mortgage for the construction project; traditionally home construction loans featured two applications, two closing dates, and two chances to have a loan application approved or denied. There is one loan for the construction itself (which must be paid for along with | more...

HUD Announces Fair Housing Act Violation Settlement With Oglethorpe Square Apartments, GA

October 23, 2018

FHA Announces Revisions To FHA Reverse Mortgage Policies

By Joe Wallace

The Federal Housing Administration has issued a press release with revised FHA requirements for Home Equity Conversion Mortgages. Effective immediately, when processing FHA Reverse Mortgages, also known as Home Equity Conversion Mortgages, alternative supporting documentation is permitted as an alternative to “previously required materials that, in many instances, delayed claim processing” according to the FHA official site. FHA Commissioner Brian Montgomery is quoted in the press release saying that the rule changes would help keep the FHA Reverse Mortgage program on a “more financially viable path”. Montgomery says, “Streamlining the HECM claim payment process makes us more responsive to participating lenders…” FHA’s new HECM guidelines are intended to keep lenders from being “unduly burdened when seeking claims payments when the HECM reaches 98 percent of its maximum claim amount”. It | more...

September 26, 2018

FHA Loans And Your Credit Report: Check Ahead Of Time

By Joe Wallace

It’s generally advised for borrowers to check their credit reports a year ahead of time before applying for a home loan. One of the reasons for the early start has to do with the amount of time it could take to dispute items on your report; outdated information, errors, evidence of stolen identity, etc. But when you are pulling your credit report, what should you be looking for? There are plenty of items you should compile a credit report checklist and include in that list. Check The Basics Before Applying For Your FHA Mortgage Or Refinance Loan The first thing to do when pulling your credit report is to make sure all of your vital information is accurate. Your name should be correctly spelled, your Social Security Number should be | more...