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Articles Published in: June 2012

June 6, 2012

FHA Loans and Government Assistance Payments–Do They Count As Verifiable Income?

By Joe Wallace

One frequently asked questions about FHA home loans involves government benefits and/or government assistance payments. Can these income sources be used for the purpose of getting an FHA guaranteed home loan? Under the right circumstances, the answer is yes. It’s not automatic–the lender must verify the source of the income and also determine how long that income will last. According to HUD 4155.1 Chapter 4 Section E, “Income received from government assistance programs is acceptable for qualifying, as long as the paying agency provides documentation indicating that the income is expected to continue for at least three years.” Borrowers aren’t simply out of luck if that income will not last for three years; it can’t be used as income, but it can be considered in other ways according to the | more...

 

June 6, 2012

FHA Loans and Verifiable Income: Alimony, Child Support, and Maintenance Payments

By Joe Wallace

Borrowers applying for an FHA home loan have good reason to consider listing alimony, child support, and maintenance payment income on their loan applications. Not all wish to have this type of income included in their application data, but when accompanied by proper documentation and when verified by the lender, these types of “non-employment income” can be used to help calculate the borrower’s debt-to-income ratio for FHA loan approval. But what does the FHA require in order to verify and approve these income sources for the FHA loan? According to the FHA official site, “Alimony, child support, or maintenance income may be considered effective, if –payments are likely to be received consistently for the first three years of the mortgage –the borrower provides the required documentation” What does that documentation | more...

 

June 5, 2012

Home Buying Advice From The Department of Housing and Urban Development

By Joe Wallace

Buying a home for the first time with an FHA guaranteed mortgage can be an intimidating process until you understand how that process works. Financial experts recommend borrowers prepare at least one year in advance before searching for a home to buy; there are many things which need to be done before an FHA loan applicant should commit to house hunting. Budgeting, pulling your credit report, learning what expenses you’ll have to pay as part of the loan process…these are all important things to know before you start looking for that first home. Once the search for a new home does begin, there are other issues a borrower should know in advance about what to do when that dream home is located. When you’re ready to commit to a loan | more...

 

June 1, 2012

FHA Home Loan Appraisals: When Do They Expire?

By Joe Wallace

FHA home loans require an appraisal to establish fair market value and insure the property meets minimum standards. But many borrowers want to know how long the appraisal has until it expires and whether or not an appraisal can be re-used. There are several reasons why this question arises; a borrower may decide not to close on the deal and another FHA loan applicant may decide to purchase the same property, for example. Or a borrower and seller may take longer than expected to close the deal. What does the FHA say about these issues? According to the FHA’s property and appraisal requirements found on FHA.gov, “Effective for all case numbers assigned on or after January 1, 2010 the validity period for all appraisals on existing, proposed, and under construction | more...