Articles Tagged With: Mortgage Insurance

Mortgage Loan Approval During Coronavirus

April 16, 2021

Learn More About Home Loans: Appraisals & Inspections

It’s important to learn as much as you can about the home loan process when planning and saving for your new mortgage. If you are a newcomer to the home loan process, there are some good resources that can help you be more informed borrower. The less informed you are, the more likely you are to have some kind of regret at the end of the home loan process. The more you know, the more confident you will feel about your choices along the way. One important issue for many borrowers is the FHA appraisal process. Are you in-the-know about what happens during the appraisal, what it is intended to do and why you should never trust the appraisal to provide you the information that only a complete home inspection | more...

September 4, 2019

HUD Disaster Resources

By Bruce Reichstein

The Department of Housing and Urban Development is reminding homeowners of the disaster resources available from federal agencies including HUD, the FHA, FEMA, and more. Those in federally declared disaster areas are eligible for special FHA home loan forbearance and other foreclosure avoidance measures. But loan forbearance and foreclosure avoidance are NOT automatic. All home owners still paying their mortgages at the time of the disaster should contact their lenders to discuss next steps and how to make arrangements to avoid home loan default and foreclosure. Lenders cannot help borrowers who do not do so, and it pays to be proactive, especially where FHA mortgages are concerned. FHA Foreclosure and Loss Mitigation Policy FHA lenders are given freedom to use “reasonable judgment in determining who is an ‘affected borrower’ in | more...

July 15, 2019

FHA Home Loans And Flood Hazard Areas

By Joe Wallace

FHA home loans have rules for loan approval that include determining if a house is suitable for the mortgage. In some cases a home might not be approved for a mortgage because of its’ condition, but in others the location of the home may be a problem. This is true in cases where a home is located too near a high pressure gas pipeline, high voltage lines, or mining operations. But there is another aspect of this you should know-the FHA loan rules for homes located in certain areas prone to flooding. FHA loan rules in HUD 4000.1 state that the lender is responsible for making sure the property to be purchased with an FHA mortgage is not located in certain government-designated flood zones. From HUD 4000.1: “The Mortgagee must | more...

Protect Your Credit During The COVID-19 Emergency

July 12, 2019

The Difference Between Homeowner’s Insurance And Mortgage Insurance

By Bruce Reichstein

The journey toward home ownership costs money; you need to save for your down payment, closing costs, inspection fees, and mortgage insurance. But there is an expense you should also know about that protects you from fires, theft, and other property damage-the homeowner’s insurance policy. What is the difference between mortgage insurance and homeowner’s insurance? Borrowers need to know the nuances and be fully prepared to become a homeowner by understanding what protects YOU and what protects the LENDER. FHA Mortgage Insurance Protects The Lender FHA mortgage insurance premiums are paid as part of your monthly mortgage payment. You are required to pay an Up-Front Mortgage Insurance Premium (UFMIP) and a monthly mortgage insurance premium. These payments are designed to protect the lender in case the borrower defaults on the | more...

April 15, 2019

FHA Mortgage Insurance Refunds

By Joe Wallace

FHA home loans do not, as conventional mortgages often do (based on LTV), require third-party private mortgage insurance, sometimes known as PMI. Instead, FHA mortgages require mortgage insurance premiums paid as part of your monthly mortgage payment. There is an Up-Front Mortgage Insurance Premium (UFMIP) that is due at closing time in cash, which may also be financed in its’ entirety should the borrower wish to do so. Then the Mortgage Insurance Premiums (MIP) are included in the monthly payment. FHA home loan rules address mortgage insurance issues in HUD 4000.1, which states, “Most FHA mortgage insurance programs require the payment of UFMIP, which may be financed into the Mortgage. The UFMIP is not considered when calculating the area-based Nationwide Mortgage Limits and LTV limits.” That means your loan limit | more...

October 15, 2018

HUD Announces Disaster Relief For Hurricane Michael Victims In Florida

By Bruce Reichstein

The Department of Housing and Urban Development has announced disaster relief for victims of Hurricane Michael in Florida. According to a HUD press release, the government will “speed federal disaster assistance to the State of Florida and provide support to homeowners and low-income renters forced from their homes due to Hurricane Michael” following a presidential declaration of a major disaster area in several Florida counties including Bay, Franklin, Gulf, Taylor, and Wakulla. The declaration means those living in the affected areas are eligible for a 90-day moratorium on foreclosure on FHA mortgages. To get the benefit of this moratorium borrowers should call their loan officers and contact the FHA Resource Center at 1-800-304-9320. Never assume it is safe to simply stop making payments on an FHA mortgage after a natural | more...

November 7, 2017

Why Do I Have To Pay For Mortgage Insurance On An FHA Loan?

By Bruce Reichstein

Why do I have to pay for mortgage insurance on an FHA loan? Borrowers who are used to the terms and conditions of conventional mortgages will know that (depending on the lender) without a substantial down payment, conventional loans require private mortgage insurance (PMI) to protect the lender in case of loan default. FHA mortgages also require loan insurance, but not through a private company. Instead, the FHA requires the borrower to pay a mortgage insurance premium as part of their monthly mortgage payment, and also an Up Front Mortgage Insurance Premium (UFMIP) at loan closing time. It’s easy to get Private Mortgage Insurance (PMI) confused with the FHA’s Mortgage Insurance Premiums (MIP) but they are not the same and FHA mortgage insurance is handled differently and has different requirements | more...

FHA Loan Limits For High-Cost and Low-Cost Areas

October 16, 2017

Can I Buy Another House With An FHA Loan?

By Joe Wallace

Can I buy another house with an FHA loan? It’s a question on the minds of many, especially those who might be concerned that NOT being a first-time home buyer might disqualify them from the FHA loan option. Is this true? FHA Loans Are Not Just For First-Time Home Buyers FHA mortgage loans are designed to be an affordable option for anyone who is financially qualified to be approved for a home loan. That means that you do not have to be a first-time home buyer, you don’t have to be “in need” to qualify, and you don’t have to worry about an income limit for FHA mortgages. FHA loans are approved on the basis of a borrower’s creditworthiness and ability to afford the loan. There is no maximum income | more...

October 11, 2017

Is There An FHA Loan For Homes On Tribal Land?

By Bruce Reichstein

Is there an FHA loan for homes on tribal land? According to the FHA loan handbook, HUD 4000.1, a type of loan known as a “Section 248 Mortgage” is available specifically for home purchases of this type. HUD 4000.1 defines the Section 248 mortgage as “a purchase or refinance Mortgage covering one- to four-family dwellings on Indian Lands.” Since definitions are extremely important for many aspects of the FHA loan program, this section of the FHA loan rules also defines what the FHA considers to be “Indian land” and the communities that live there: “Indian Land refers to those lands that are held by or for the benefit of Indian Tribes under some restriction or with some attribute peculiar to the legal status of its owners. Indian Tribe refers to | more...

Who can apply for FHA Reverse Mortgages?

October 9, 2017

Can I Get An FHA Mortgage For A Home In A Flood Zone?

By Joe Wallace

Can I get an FHA loan for a home in a flood zone? With Hurricane Harvey, Hurricane Irma, and many other natural disasters, it’s logical that someone looking for a home anywhere near these disasters would wonder if their house hunt is going to be affected. FHA loan rules do address flood zones and FHA appraisal requirements for these areas; the answers can be found in HUD 4000.1. The FHA loan rules for this issue can be found under a section covering general property eligibility for an FHA mortgage. On page 143, we learn: “The Mortgagee must determine if a Property is located in a Special Flood Hazard Area (SFHA) as designated by the Federal Emergency Management Agency (FEMA).” “The Mortgagee must obtain flood zone determination services, independent of any | more...