Articles Tagged With: First-time Home Buyer

March 27, 2025

Why You Should Monitor Your Credit As A First-Time Home Buyer

Are you a first-time home buyer interested in buying or building a home? New borrowers should monitor their credit for signs of identity theft, erroneous information, and outdated credit data; doing so improves your chances at home loan approval by ruling out issues that may be related to credit report problems that are not your fault. In 2025, monitoring these issues is more critical than ever. Some future homeowners already pay strict attention to their credit, but not everyone does. And they should–credit monitoring should play a crucial part of your preparation stages before applying for an FHA mortgage. The principles we discuss here can protect you when applying for any big loan, including cash-out refinancing. Regular Monitoring Eliminates Surprises Later Regular updates about your credit report reduce the chances | more...

March 1, 2025

5 things to know about FHA Appraisals

By Joe Wallace

What do you need to know about FHA appraisals? There are plenty of details to be concerned with depending on the nature of the property you want to buy but some issues loom larger than others. FHA Appraisals Are Not Home Inspections That’s an obvious one. The FHA appraisal is meant as a tool for the lender and not the borrower. What’s not so obvious? The appraisal process does not require the appraiser to be an expert in all systems of the home. That means your roof may have problems the appraiser can’t identify, or the HVAC system might be experiencing symptoms unfamiliar to your appraiser. In some cases, the appraiser might not even set foot inside a building to be appraised. It’s not so hard to understand why you | more...

February 28, 2025

What Kind Of House Can I Buy With An FHA Mortgage?

By Joe Wallace

What kinds of homes can be purchased with an FHA mortgage loan? You can build a home from scratch using an FHA Construction mortgage, but may people want to buy existing property and what kinds. Eligible Property Types For FHA Mortgages FHA loan rules in HUD 4000.1 state clearly that certain kinds of property are permitted and certain kinds are not. These rules on eligible property types that can be purchased with an FHA mortgage loan are found in HUD 4000.1, and include the following guidance you should know: FHA programs “differ from one another primarily in terms of what types of Properties and financing are eligible. Except as otherwise stated in this SF Handbook, FHAs Single Family programs are limited to one- to four-family Properties that are owner-occupied Principal | more...

February 20, 2025

Why You Should Consider A Limited 203(k) Rehab Loan

By Bruce Reichstein

Do you want to buy or refinance a fixer-upper home? The FHA 203(k) Rehabilitation loan and the FHA 203(k) Rehabilitation Refinance loan can help if you would rather buy a fixer-upper or renovate an existing home you’re living in as your primary residence. You don’t have to buy a property to use the FHA 203(k) rehab loan; you can use it to refinance your current home and get money to accomplish FHA and lender-approved improvements or other projects associated with remodeling or renovation. That said, not every borrower needs to fully refinance a home to repair or improve it. Are you thinking of smaller projects that don’t require a huge sum of money? The Limited 203(k) Rehab loan lets you accomplish smaller projects without committing to a full refinance or | more...

February 18, 2025

FHA Home Loan Approval Versus Your Debts

By Joe Wallace

In 2025 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 Loan Approval and Late or Missed Housing Payments

February 11, 2025

What Hurts Your Chances For FHA Loan Approval

By Joe Wallace

What can stop your FHA home loan from getting approved? Knowing what the lender will do when confronted with common home loan problems can be half the battle for some. In 2025 house hunters need to be more vigilant than ever to protect their credit and their ability to obtain it. If you can anticipate the lender’s expectations for things like credit, verifiable income, reliable credit history, and other factors you can get a lot closer to loan approval. What You Should Know About FHA Home Loan Minimum FICO Scores Borrowers with FICO scores below 500 are not eligible for an FHA mortgage loan. Borrowers with credit scores above 500 but below 580 may technically qualify but these applicants must put 10% down rather than the lowest down payment possible | more...

January 29, 2025

Can An FHA Loan Be An ARM?

By Bruce Reichstein

There are many choices to make when you want to buy a home. One of those choices is deciding whether a fixed-rate or adjustable-rate mortgage is right for you. In 2025, that choice might be tougher to make depending on interest rates, house prices, and other variables. FHA home loans come with an adjustable-rate mortgage option with an introductory rate followed by an adjustment period that may vary depending on what you and the lender agree upon. When you choose an adjustable-rate mortgage, an ARM loan, the introductory rate is typically more competitive than the fixed-rate FHA option. Some borrowers plan to sell or refinance before the first adjustment or soon thereafter when using an ARM loan. ARM loans are best for those who plan to deal with those adjustments. The | more...

January 14, 2025

What Can Kill An FHA Home Loan?

By Bruce Reichstein

Those who want a home loan have to prepare for the new loan application in several ways–financially, through saving up for the down payment and closing costs, and with credit prep. That can mean working on your record of on-time payments, lowering your overall debt amounts, and avoiding new credit in the meantime. When applying for any large line of credit, there are some things that can stop your loan dead in its tracks. If you want a home loan and are worried about being approved for a home loan, add these issues to your mental not-to-do checklist and make sure you know how to avoid them. Avoid New Debt Your lender pulls your credit when you apply for your home loan–most people know that. But not as many know | more...

January 13, 2025

FHA Home Loans: How Much Income Do You Need To Qualify?

By Joe Wallace

Many future homeowners want to know about the income requirements for an FHA loan–are you worried that you won’t qualify for an FHA mortgage because you don’t earn enough each month? And then there’s the opposite problem–a misconception that you can earn “too much” to qualify for an FHA mortgage as though this program had income limits. FHA loans do NOT feature income limits and this program does not require you to qualify based on financial need. FHA Loans Are For All Financially Qualified Applicants There is no minimum income requirement for an FHA mortgage, and there is no upper limit or income “ceiling”. FHA loans are not targeted for any one income bracket. FHA loans are designed with more lenient FICO score minimums in mind, but that has nothing | more...

FHA Home Loans And The Biggest Credit Mistake You Can Make

December 16, 2024

FHA Cash-Out Refinance Loan Rules You Should Know

By Bruce Reichstein

What should borrowers know about FHA cash-out refinance loans? If you are thinking of cashing in on the equity built up in your home in 2025, there are some important details to know before you get started. There are a few rules to keep in mind, but some of the most important include how you can use the proceeds of a cash-out refinance loan and the rules the lender follows when verifying the borrower’s eligibility for a cash-out loan. Borrowers may wish to pay off credit card debt with an FHA Cash-Out refinance loan, or use the money to pay off nuisance debt, buy a car, go on vacation, etc. What are the rules for FHA cash-out refinance loans and the money back to the borrower? How To Use FHA | more...