April 21, 2011
FHA Loans: Income Verification Facts
Like many other loan products, FHA insured mortgage loans require
Articles Published in: April 2011
April 20, 2011
FHA Loans and Retirement Income Verification
When applying for an FHA home loan, the borrower must list all sources of income so they can be verified as part of the loan approval process. The lender is required to check all sources of income to insure they are dependable and “likely to continue” into the future, according to the FHA official site. Income verification helps the lender accurately determine a borrower’s debt-to-income ratio; without knowing that ratio it’s impossible to issue a loan with any degree of certainty that it would actually be repaid.
April 19, 2011
FHA and HUD Turn Up the Heat on Mortgage Scammers
Recent announcements by the FHA and HUD have increased the pressure on housing market scammers, but consumers should still be on the lookout for warning signs of a scam artist at work. The most recent announcement from FHA/HUD comes in Mortgagee Letter 2011-17, which revises HUD
April 19, 2011
New HUD Awareness Campaign Targets Foreclosure Con Artists
FHA borrowers have a new resource to look to in order to become more educated borrowers and avoid foreclosure scams. The Department of Housing and Urban Development has announced a new awareness campaign called Know It. Avoid It. Report It. According to an April 18, 2011 HUD press release, the campaign has launched in Miami, Chicago and Los Angeles and has two missions; one to direct homeowners in financial trouble toward reputable counselors and anti-foreclosure resources, the other to get the help of homeowners to shut down scams and con artists. The HUD press release warns home owners, “Newly deceptive scam artist tactics lure homeowners into misleading agreements. Their tactics include giving the false impression that they are affiliated with the government, charging illegal up-front fees, and executing fraudulent lease-back, | more...
April 18, 2011
FHA Loans: Facts About the Good Faith Estimate
The HUD GFE Good Faith Estimate is paperwork the borrower is given as part of the the FHA loan process. This is a very important document–it explains the nature of the FHA loan including potential interest rate increases, the amount of monthly mortgage payments that could increase as a result, and plenty of other data crucial to making a budget for the new mortgage and other living expenses. The form states, “This GFE gives you an estimate of your settlement charges and loan terms if you are approved for this loan. For more information, see HUD
April 15, 2011
Does the FHA Owe You Money?
Does the FHA owe you money? Some are led to believe so based on third-party advertising on television, the Internet, direct mail and via telemarketing calls, but should you believe these advertising efforts? According to the FHA, there’s a very simple way to determine whether the FHA owes you money; “If you had an FHA-insured mortgage, you may be eligible for a refund from HUD/FHA”, FHA.gov says, explaining that some borrowers are owed a partial refund of mortgage insurance premiums under the right circumstances. Only borrowers who have loans originated after September 1, 1983, paid up-front mortgage insurance at closing time and most importantly, did not default on mortgage payments are eligible to get this refund money.
April 15, 2011
FHA Loans: Borrowers with Disabilities and the Fair Housing Act
Who is affected by Fair Housing act laws and related government regulations? The short answer; just about everyone. According to the FHA official site the Department of Justice and the Department of Housing and Urban Development share responsibilities for enforcing the Fair Housing act, and FHA borrowers have plenty of built-in ways to seek resolution in legitimate cases of discrimination. FHA and HUD have extensive resources to record, track, and investigate complaints from FHA borrowers about violations of the act. The Fair Housing act prohibits all types of housing discrimination, including “the refusal to make reasonable accommodations in rules, policies, practices, or services when such accommodations may be necessary to afford a person with a disability the equal opportunity to use and enjoy a dwelling” according to the FHA official | more...
April 14, 2011
FHA Loans and Counseling Agencies
The FHA encourages borrowers preparing to apply for an FHA insured mortgage to get credit counseling and/or first time home buyer counseling where appropriate. An informed borrower is better protected in the real estate marketplace; in some cases the FHA actually requires applicants to get counseling to protect the borrower from making poor decisions about certain kinds of loan products. HECM loans/reverse mortgages are one type of FHA insured mortgage that require counseling in order to get loan approval, due in part to their unique nature compared to other types of loans. To help FHA loan applicants, the agency refers borrowers to approved counseling agencies. In an age where anyone can set up a storefont and pretend to dispense advice about credit, foreclosure avoidance and buying a home, the FHA’s | more...
April 13, 2011
FHA Anti-Discrimination Rules and HUD Fair Housing Grants
As we’ve mentioned elsewhere in this blog, the FHA and HUD have strict anti-discrimination requirements built in to the FHA loan process. The Fair Housing Act prohibits discrimination in any part of the real estate process, and while the borrower is often the first line of defense in terms of reporting and identifying discriminatory housing practices, the FHA anti-discrimination system works. But no system is perfect, and the FHA/HUD continuously look for new ways to strengthen the system in order to provide equal credit and housing access to all applicants. The only thing that should determine whether an applicant can buy a home with an FHA-insured mortgage is whether or not the borrower meets FHA and lender qualifications for the loan. That’s one reason why HUD recently announced a $41million | more...
April 12, 2011
FHA HECM Loans: Questions Seniors Should Ask
The FHA reverse mortgage, also known as a Home Equity Conversion Mortgage or HECM loan for short, can be an important tool for many seniors. The FHA reverse mortgage is a home equity conversion loan that allows qualified borrowers age 62 and older to get a mortgage that has no monthly payments and is only payable when the borrower dies or sells the home. Like other FHA mortgages, FHA HECM loans have occupancy requirements and the borrower can only apply for a Home Equity Conversion Mortgage for the home they use as the primary residence. As with any major financial commitment, the HECM loan is not to be entered into lightly or without serious planning. That’s one reason why the FHA has mandatory counseling required as part of any HECM | more...