Articles Tagged With: First-time Home Buyer

February 21, 2019

Buying A Home With An FHA Mortgage Versus Renting

How much money do you spend renting a home instead of owning one? If you count the security deposit, any applicable pet deposit, and other expenses, the numbers can add up quickly. When you rent a home instead of buying real estate with a mortgage loan, you are also stuck with whatever appliances your landlord has seen fit to install in the home, regardless of quality. You have to live with someone else’s interior design and paint scheme preferences, and chances are the carpet is not what you would have chosen…at all. Renting A Home: Where Are The Long-Term Financial Benefits Compared to Home Ownership? When you rent, you get no equity, no cash-out refinance loan option, and no ability to sell the home at a higher price than you | more...

February 20, 2019

How Does An FHA Mortgage Help A First-Time Home Buyer?

By Bruce Reichstein

When it’s time to buy that real estate you’ve had your eye on, how can an FHA mortgage help out a first-time home buyer? What do you need to know about FHA loans that can help you make the most informed choices? FHA Loans Offer Lower Credit Requirements Yes, there are conventional home loans you may qualify for with lower FICO scores, but you may face larger down payment requirements, which means more money out of pocket up front. FHA home loans require a 3.5% down payment for those with FICO scores 580 or higher. Lender standards may be higher than this, but the FHA minimums are lower than conventional loans. FHA Loans Allow Certain Closing Costs To Be Financed Ask your lender which closing costs of your specific transaction | more...

February 19, 2019

What You Should Know About FHA Home Loan Credit Checks As A First-Time Home Buyer

By Joe Wallace

Before you get FHA home loan approval on that piece of real estate you have your eyes on, your mortgage loan application process will include a credit check. Your lender will need to determine your creditworthiness, and also verify your employment and income. Most borrowers expect this process and thanks to having other kinds of credit applications including credit cards, auto loans, and student loans, have a basic idea of what will happen. But not everyone expects that their initial credit check for the home loan they are applying for will NOT be the last one the lender does before the loan closes. You might not get the down-low on this from your real estate agent or your lender, but this is one of the “secret” things about the home | more...

February 18, 2019

Happy Presidents’ Day 2019

By Bruce Reichstein

Happy Presidents’ Day 2019! Today banks and markets are closed, and we pause from our usual schedule of writing posts and giving information about FHA home loans to observe the holiday. We return with our regular content schedule tomorrow. Thank you very much for reading!

FHA loan policy changes for income and employment verification

February 15, 2019

FHA Loan Policy Changes Regarding Income, Employment Verification

By Joe Wallace

The FHA and HUD have issued a Mortgagee Letter explaining recent policy changes that affect how borrowers will have their income and employment verified, among other issues. Mortgagee Letter 19-01, issued February 15, 2019, announces the specific inclusion of third-party vendors (TPV) for the purpose of income and employment verification. The change is needed, according to the Department of Housing and Urban Development, because FHA home loan rules in HUD 4000.1 did not previously mention third party vendors specifically. “FHA allows for electronic verifications as an option to a written Verification of Employment but makes no specific reference to TPV services. TPV provides an alternative means for verifying a Borrower’s employment, income, and assets which would eliminate the requirement for a Mortgagee to collect pay stubs, W-2s, and bank statements”. | more...

February 14, 2019

Should You Become A Landlord With An FHA Mortgage?

By Bruce Reichstein

Some reports in 2019 indicate more married couples living with room mates than ever; since the mid-90s the number of couples who live with roommates has doubled and many people are considering renting out a spare bedroom to cover housing costs. If you are thinking about a mortgage loan as a first-time home buyer and wondering how you might be able to afford the loan long-term, consider using an FHA mortgage loan to purchase a property with more than one living unit and renting out the unused unit. FHA home loans are possible for first-time buyers (and all other financially qualified applicants) with homes up to four units, making your options to rent out a spare bedroom very attainable. There is no increase the the minimum FHA loan down payment | more...

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...

February 12, 2019

Rising Rent Versus FHA Home Loans For First-Time Home Buyers

By Joe Wallace

Real estate and home mortgage blogs in the first quarter are 2019 are still reporting on the rising rent trends in many areas of the country that seem to be encouraging renters to examine their home buying options. Did you know that rents increased in places ranging from Wichita, Kansas to Scottsdale, Arizona? The increases in those two areas was above 12% each. Studio apartment rents climbed roughly 5% higher by the end of 2018, and in Newark, New Jersey renters were on the receiving end of more than 17% higher rents from last year. If you are tired of renting and are considering buying a first home, consider these perks of the FHA home loan program: Low Down Payment Requirements For FHA Loans First time home buyers looking at | more...

February 11, 2019

How To Find The Right Mortgage

By Bruce Reichstein

First-time home buyers often aren’t sure what to look for when it comes to choosing the right mortgage loan. You can have a real estate agent help you with MLS listings to find the right type of home, you can compare participating FHA lenders to see which ones offer the best mortgage loan interest rates, and you can select from a variety of options with the mortgage itself. Choose The Right Mortgage Loan For Your Needs The family that needs to relocate to a new area for a job move does not have the same immediate needs as someone interested in buying a fixer-upper home with an rehabilitation loan. Your needs and financial goals will play an important part in the type of mortgage loan you choose. FHA Home Loans | more...

February 8, 2019

FHA Mortgage Loan Approval For First-Time Borrowers

By Joe Wallace

What does it take for a first-time borrower to get home loan approval with an FHA mortgage? There are several areas to pay attention to; don’t make the common first-time buyer mistake of thinking that FICO scores are the only thing that matter when it comes time for your lender to approve your mortgage loan. First Time Buyer Home Loan Approval Criteria: Employment FHA loan rules require your lender to verify two years of employment, though those two years do not have to be with the same company. What borrowers should know about this requirement is that the lender wants to know if your income is stable and likely to continue long after the loan has been closed. Generally a lender wants to know if your current income will allow | more...