October 14, 2018

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Articles Tagged With: FHA Mortgage Loans

FHA Loan Rules For Presidentially-Declared Major Disaster Areas

FHA Loan Rules For Presidentially-Declared Major Disaster Areas

In September of 2018, the FHA and HUD issued a reminder to lenders and FHA loan servicers regarding official policy for dealing with loans in presidentially-declared major disaster areas. A document labelled FHA INFO #18-40 states that for both forward loans and FHA reverse mortgage loans, certain guidance applies once the federal disaster area declaration has been made. The guidance begins with a definition of the disaster area declaration, explaining that it is made when “natural or other events are of such severity that it is beyond the combined capabilities of state and local governments to respond”. When this is invoked by the president, FHA loan guidance to participating lenders includes the following: FHA Loan Foreclosure Moratorium FHA loan rules include a 90-day moratorium on foreclosures following the declaration of | more...

 
FHA One-Time Close Construction Loans In 2019

FHA One-Time Close Construction Loans In 2019

Why should borrowers consider applying for an FHA One-Time Close (OTC) Construction Loan to build a home in 2019? There are several reasons why having a home built for you from the ground up rather than purchasing an existing construction property might be appealing. FHA One-Time Close mortgages are construction loans that have a single application and closing date; they require the use of escrow and the borrower can either purchase land to build on or use the land already owned. What are the motivations for using an FHA OTC? FHA One-Time Close Construction Loans have lower down payment guidelines, equity in the land owned could be used toward the FHA down payment requirement where applicable, and the borrower makes no mortgage payments during the construction phase of the loan. | more...

 
FHA Home Loan Approval Questions

FHA Home Loan Approval Questions Part One

FHA home loan approval is a process that requires your lender to review your credit history, employment history, and many other factors before deciding to approve or deny a home loan application. There are many questions about this process, and the more answers you have before yo start filling out applications, the better. The answers in this blog post pertain to FHA loan basics, but also rules for self-employed borrowers and those earning commission income. FHA Loan Approval Basics: What Do I Need To Know? The lender will pull copies of your credit report and review your payment history for the 12 months leading up to the mortgage loan application. FHA loan rules are similar to other home loan requirements in this area; coming to your FHA mortgage application process | more...

 
What Happens If I Pre-Pay My FHA Mortgage?

What Happens If I Pre-Pay My FHA Mortgage?

What happens if you pre-pay your FHA mortgage? FHA home loans are known for having no pre-payment penalty but there may be certain steps the borrower is required to take in order for such pre-payments to be used as intended. The date of your FHA loan may make an important difference in how you are to proceed; it’s best to discuss pre-payment options with your loan officer ahead of time to learn what, if any, additional lender requirements may exist above and beyond the FHA loan standards we’re discussing here. What follows is NOT lender policy but the FHA loan rules. Lender requirements may add to or further develop these FHA guidelines. FHA Home Loan Rules For Pre-Payment On Mortgages Closed On Or After January 21, 2015 FHA loan rules | more...

 
FHA Loan Rules For Presidentially-Declared Major Disaster Areas

FHA Rehab Home Loans For Disaster Victims

Those living in federally-declared major disaster areas may be eligible for an FHA home loan to replace or repair properties that have been damaged by the disaster such as a hurricane, floods, etc. FHA 203(h) rehab loans are designed specifically for this purpose-the 203(h) disaster loan features no down payment, an FHA FICO score requirement of 500 or higher, and the rehab loan can only be used for principal residences only. That means owner-occupiers only. How does the FHA 203(h) rehab loan work? HUD 4000.1 has the rules for this type of mortgage loan. The FHA 203(h) rehab loan is quite similar to the FHA 203(k) rehab loan which is available to any financially qualified borrower who meets FHA occupancy requirements for the home. FHA rehab loans allow funds to | more...

 
Five Questions People Ask About FHA Home Loans

Five Questions People Ask About FHA Home Loans

Got questions about FHA home loans? Here are five questions people typically ask about FHA mortgages and the answers according to the FHA loan rules found in HUD 4000.1. Remember that additional lender standards may apply and these answers are based on FHA loan guidelines and not additional lender requirements. Do FHA Home Loans Offer A No Down Payment Option? FHA mortgage loans do not come with zero money down or no money down options but FHA loan rules do allow borrowers to accept properly documented gift funds for down payments from relatives, friends, or employers. You can’t use a credit card cash advance to make the down payment, nor can your down payment gift fund provider. Ask your lender how to help properly document the source and nature of | more...

 
FHA Home Loans And The Accuracy Of Your Credit Data

FHA Home Loans And The Accuracy Of Your Credit Reports

When you start planning for your FHA home loan and reviewing your credit reports, it’s entirely possible that you could find erroneous information in your reports. Sometimes the credit information for another person with a similar name could wind up accidentally being posted in your report, other times there may be inaccurate data in your credit history about the amount, frequency, or age of your credit account payments. How should a potential FHA borrower deal with these issues? HUD 4000.1 addresses some aspects of this issue, but not all the credit problems a borrower could experience when reviewing a credit report are covered by HUD and FHA home loan rules. HUD 4000.1, the FHA loan handbook, instructs the lender on how to proceed if the lender finds inaccuracy in debt | more...

 
What Is A Mortgage?

What Is A Mortgage?

What is a mortgage? To some that may sound like a totally obvious question, but for some first-time home buyers, the more information you get up front about the process of finding, buying, and owning a home the better. And that includes the most basic details of the process. FHA mortgages are an option for the serious home buyer who wants a lower down payment than many conventional mortgages and would like to enjoy the benefits of a government-backed mortgage. Why Do I Need A Mortgage? This is one of the most basic questions about the home buying process. Most people will apply for a mortgage to buy a home whether that’s an FHA new purchase mortgage, A VA home loan for qualifying military members, a USDA mortgage for those | more...

 
What Is Good Credit? FHA Mortgage Loan Credit Score Ranges

What Is Good Credit? FHA Mortgage Loan Credit Score Ranges

What is considered good credit? Do you know what credit score ranges are considered the best? Or which credit scores are considered marginal or even what lenders consider to be bad credit? There are specific credit score rules in HUD 4000.1 that define who may be approved for the lowest down payment for an FHA mortgage loan, and specific ranges of FICO scores that require more money down. And finally there are the credit scores that are simply not eligible for the FHA home loan program. But these ranges don’t really address what is considered to be good or bad credit. They are simply the credit score numbers that make you eligible for the lowest down payment, a higher down payment, or no FHA loan approval at all. FHA loan | more...

 
FHA Home Loan Mistakes To Avoid Before You Close The Deal

FHA Home Loan Mistakes To Avoid Before You Close The Deal

If you’ve found the home you want to buy with an FHA mortgage and it looks like you are going to definitely close the deal, don’t be fooled; there are still mistakes to avoid before you sign the papers and accept the keys. One important blunder that should be avoided at all costs? Changing your financial status before loan closing-as in applying for new lines of credit, missing payments, or other issues that can have your loan officer thinking twice about approving the loan and allowing it to close. If your debt-to-income ratio isn’t ideal to start with, the addition of new credit will definitely affect your potential to close. FHA loan rules, lender standards, and other requirements all may factor into the decision on how to handles such contingencies. | more...