January 6, 2011
FHA reverse mortgages, also known as a Home Equity Conversion Mortgage, are a way for qualified borrowers to take out a home loan against the equity built up in them without having to worry about monthly mortgage payments. The FHA reverse mortgage program requirements are set up for a specific group of eligible borrowers. Do you know if you qualify? Here are the basic facts about FHA-insured Reverse Mortgages or HECM loans:
December 30, 2010
FHA HECM loans are designed for borrowers who are 62 and older who want to take advantage of the equity built up in their homes. HECM, which stands for Home Equity Conversion Mortgage and is also known as an FHA Reverse Mortgage, allows qualified borrowers to apply for an FHA loan which uses equity as the security for the loan. HECM loans have no monthly mortgage payments. The borrower pays off the loan in full if the property is sold or the borrower dies. Because of the structure of FHA HECM loans, the borrower can use the proceeds from the loan as a line of credit, choose to get monthly payments instead, or a combination of the two.
December 29, 2010
Most FHA home loan programs require the borrower to make a minimum down payment of 3.5% of either the appraised value of the property or the asking price of the home, whichever is lower. The downpayment is strictly regulated. The buyer is not only required to put down his or her 3.5%, but the FHA also requires documentation on the source of the down payment money in many cases. Documentation is required when the borrower pays more than 2% of the sale price. It's also required in any situation where the lender has certain questions about the down payment. According to FHA requirements, documentation is needed when the down payment "appears excessive based upon the borrower
December 20, 2010
How much do I need to make to qualify for an FHA mortgage? That is among the most popular questions about FHA home loans. According to the FHA, there is NO minimum income requirement to apply. That said, the FHA does require a three-year employment record showing steady income during that time. Note that the requirements don't say you must have held the same job for three years, only that the income has been reliable. The fact is, in order to qualify for an FHA home loan, there is no one single determining factor that gets you approved or declined; the FHA examines a combination of factors to determine an applicant's overall credit worthiness and ability to pay the FHA mortgage on time every month.
December 9, 2010
FHA borrowers, VA mortgage and conventional loan holders can all face default and foreclosure. There's no mystery as to what happens when the bank sends a foreclosure notice--it's all there in black and white. The key is to avoid getting to that point in the first place. There are plenty of programs for first-time home buyers and other home owners who are behind on their mortgages, but what's not so well-known is the assistance for those struggling to pay second mortgages. That's where the government home loan bailout program Making Home Affordable comes in with the Second Lien Modification Program or 2MP for short.
November 30, 2010
There are two basic types of mortgages new house hunters should know about when shopping for FHA home loans; fixed rate FHA mortgages and Adjustable Rate Mortgages or FHA ARM loans. The FHA Adjustable Rate Mortgage is exactly what its name implies--an FHA home loan with an interest rate that can be adjusted up or down according to FHA requirements, the market and other factors. Thanks to the 2008 housing crisis, many soon-to-be homeowners are skeptical about adjustable rate mortgages whether offered by the FHA or not; FHA adjustable rate terms are definitely more predictable in some ways than their conventional loan counterparts. One of the reasons for that predictability is the ARM interest rate adjustment cap imposed on the loan. The cap protects the buyer from large swings in | more...
November 24, 2010
The FHA has a maximum debt to income ratio set for FHA loans. When a borrower applies for an FHA mortgage, they must list all debts and lines of credit in detail as well as all possible approved income sources. With this information, the lender and FHA can calculate what a borrower's debt picture is and issue a percentage of debt to the amount of income listed. For FHA home loans, the rules are clearly spelled out. According to the FHA official site, "The FHA allows you to use 29% of your income towards housing costs and 41% towards housing expenses and other long-term debt."
August 23, 2010
Home Equity Conversion Mortgages, or HECM for short, are designed to help qualified borrowers take out an FHA guaranteed loan against the equity built up in their property. They are intended for a specific segment of homeowner; FHA requirements for HECM loans include an age-specific restriction, plus qualifying ownership status, and restrictions on the type of property that can be used for a Home Equity Conversion Mortgage.