Articles Tagged With: First-time Home Buyer

December 10, 2019

Higher FHA Home Loan Limits For 2020

In 2019, the FHA and HUD announced higher loan limits, giving borrowers in most counties additional borrowing power to purchase, build, repair, or refinance an owner-occupied home. The uptick in FHA loan limits for 2019 led some to believe that it might be possible to see another year of higher loan limits, while others speculated that higher limits may not be a trend, but simply a typical course correction for home loan limits. Regardless of which camp 2020 borrowers were in back then, it seems there is another year to contemplate higher loan limits; the Department of Housing and Urban Development has released the FHA loan limits for 2020 and they are indeed higher in most areas. The HUD announcement discussing the overall increase in the FHA loan limit for | more...

December 9, 2019

Applying For A Home Loan In 2020

By Joe Wallace

Are you thinking about buying or building a home in 2020? Prepare for your dream home early and get ready to start the path to homeownership in the new year. Save Early What kind of expenses should you anticipate when saving for your home loan? It’s not just the down payment you’ll need to save for–here is a list of common home loan expenses: Title insurance Appraisal costs Pest inspection fees Origination fees Discount points Credit report fee Survey fee Property taxes Mold abatement (where applicable) Document prep Compliance inspections You will also want to save early for unexpected costs including contingencies where the appraised value of the property is lower than the asking price. Some borrowers like the home so much they are willing to pay the difference in | more...

December 6, 2019

Why Did My Mortgage Payment Increase?

By Bruce Reichstein

There may be circumstances where you find your mortgage payment has increased. There are several reasons why a mortgage payment might increase; regardless of which issue may be affecting your loan it’s crucial to address it right away. Mortgage Payment Increases Due To Interest Rate Adjustment If you have an FHA Adjustable Rate Mortgage, your mortgage payment increases when there is a scheduled interest rate adjustment on the mortgage. The government watchdog agency known as CFPB, the Consumer Financial Protection Bureau, advises, “Some homeowners believe that they have a fixed-rate mortgage loan when their loan actually includes an adjustable-rate or some other feature that can cause their interest rate and payment to change.” Changes To Your Property Taxes If you notice an increase in your mortgage payment, check your monthly | more...

December 5, 2019

Who Qualifies For FHA Loans?

By Joe Wallace

Whether you’re interested in building a house from the ground up on your own lot or you need a mobile home or condo unit, there is an FHA home loan for you. Who qualifies for these mortgages and why? FHA Loans For First-Time Home Buyers FHA mortgages are open to first-time homebuyers without perfect credit. You can apply for an FHA home loan even with past credit mistakes; the best thing to do is to review your past credit and make sure your home loan application is turned in once you have a full year of on-time payments on your credit record. First-time borrowers should know an FHA mortgage, even an FHA One-Time Close construction loan is within their reach thanks to low 3.5% down payment requirements and the ability | more...

December 4, 2019

Don’t Make These Mistakes With Your One-Time Close Construction Loan

By Bruce Reichstein

The FHA One-Time Close construction loan is meant for borrowers (first-time home buyers or otherwise) who would rather build a house on their own lot instead of buying an existing property. The beauty of the FHA One-Time Close loan is that you can be a first-time home buyer and make the same low down payment of 3.5% as any other FHA borrower. But there are some pitfalls to avoid with FHA One-Time Close mortgages; these are the same mistakes that are made with other home loan transactions, but with a construction loan you may find that more attention is paid to these issues due to the more complex nature of the loan. Avoid Changes In Your Credit Changes to your financial status before loan closing means things like adding more | more...

December 3, 2019

FHA Loan Rules And Your Personal Information

By Joe Wallace

HUD 4000.1, also known as the FHA Single-Family Lender’s Handbook, guides the lender through the entire FHA loan process including how your application data must be processed. In the same way FHA loan rules have a lot to say about where a borrower’s down payment money comes from and verifying the sources of those funds, FHA loan rules also govern how the lender can gather your financial data. For example, did you know your credit scores and other data must be given to the lender from approved sources and that the information cannot come from you even if it’s sealed and hand-delivered? Did you know that HUD 4000.1 does not permit the borrower to handle or transmit other kinds of information to the lender, too? Sourcing counts in both down | more...

December 2, 2019

Home Loans After A Bankruptcy

By Bruce Reichstein

Are you interested in a new home loan but are worried about a past negative credit event such as a bankruptcy? Borrowers sometimes have many questions about FHA mortgages and bankruptcy. One of the most common scenarios asked about include borrowers who are about to be discharged from their bankruptcy and are contemplating a home loan. With low credit scores and a recent bankruptcy, what is a borrower to do in order to become eligible for a home loan once more? In such cases, you need to know the FHA loan rules in HUD 4000.1 which require a minimum waiting time or seasoning period before a borrower can apply for an FHA mortgage once more. The waiting time begins at the time the bankruptcy is discharged. Note that it does | more...

November 28, 2019

Happy Thanksgiving 2019!

By Joe Wallace

Happy Thanksgiving 2019! We pause from our usual schedule of writing about FHA home loans and answering reader questions to observe the holiday. Thank you very much for reading! Our regular schedule of posts resumes on Monday. Thanks for reading!

November 27, 2019

Home Loan Approval: Why FICO Scores Matter

By Joe Wallace

If you want to buy a home, you will need to become well-read about credit, credit scores, and how your credit report affects your ability to apply for a mortgage loan. There are three major credit reporting agencies, Equifax, TransUnion, Experian. The fact that there are three agencies is one good reason why credit experts encourage borrowers to check their credit reports as early as possible prior to applying for an FHA mortgage or any other major line of credit. One credit report could have discrepancies another one does not reflect, etc. A borrower should always know what their lender is going to see on the report before the application is completed. FICO scores are indeed an important part of FHA loan approval, and borrowers should respect FICO scores and | more...

Buy or Build a House On Your Own Lot in 2020

November 26, 2019

Buy or Build A Home With An FHA Mortgage In 2020

By Bruce Reichstein

Are you thinking about becoming a homeowner in 2020? Some borrowers have an advantage when getting financially ready for their FHA loan application, while others may overlook important areas that need attention long before the loan paperwork is filled out. Preparing early is the key to the most seamless loan process possible. Are you ready to start exploring your options? Or are you just getting started with your credit reports, debt-to-income ratio, budgeting for the down payment and closing costs, etc.? Ask Yourself The Right Questions About Your FHA Home Loan How long have you been planning and preparing for the new loan? This is a very important question–without enough time to sort out potential problems on your credit report (identity theft, outdated information, incomplete or wrong details, etc) or | more...