September 17, 2012
FHA Makes Revisions To Condo Project Approval Process
The Federal Housing Administration has issued revised condo approval guidelines applicable for
Articles Published in: September 2012
September 14, 2012
FHA Loan Reader Question: FHA Loan Approval
A reader asks, “How long does it take a lender to let you know if you qualify for the FHA loan?” The answer to this question varies greatly depending on the lender. There are many factors that can play a part in the processing time for an FHA mortgage including the lender’s backlog of work waiting to be processed and other issues. But there is an FHA loan rule that states the lender does have a time limit to take action on your loan application. There is a 30 day time limit–the lender must act on your application within 30 days and inform you of that action. That’s not necessarily a mandate to have your loan approved in 30 days, and there are caveats to the 30 day rule which | more...
September 13, 2012
FHA Loan Reader Questions: Credit Scores
A reader asks, “I don’t have an FHA loan and can’t get a loan. I’m on a fixed income and need HUD assistance due to hurricane Issac damage. Who can I get assistance from? My credit is poor but I can pay mortgage. I am a single parent and don’t know where to turn. We need a home desperately! The one we are in now is not healthy and
September 12, 2012
Can an FHA Lender Enforce Special Requirements For Borrowers On Maternity Leave?
The FHA and HUD issue press releases about enforcement activity related to the Fair Housing Act, which addresses issues and questions such as the one in our headline, “Can an FHA Lender Enforce Special Requirements For Borrowers On Maternity Leave?” To answer that question, let’s look at a boilerplate statement found in almost every FHA/HUD release about anti-discrimination cases. “The Fair Housing Act
September 11, 2012
FHA Loan Minimum FICO Score: A Reader Question
A reader asks, “What is the lowest starting credit score?” This is a difficult question for some borrowers because the answer isn’t as straightforward as quoting the FHA loan rules. Individual lenders don’t have to require a standard identical to the minimum–they are free to require higher scores. For example, in a 2010 press release titled, “FHA Announces Policy Changes to Address Risk and Strengthen Finances ” the FHA and HUD announced a change for minimum FICO scores required in order to be approved for an FHA guaranteed home loan. The press release stated FHA and HUD planned to: “Update the combination of FICO scores and down payments for new borrowers. New borrowers will now be required to have a minimum FICO score of 580 to qualify for FHA’s 3.5% | more...
September 11, 2012
FHA Loan Reader Questions: Foreclosure Seasoning Periods
A reader asks, “Apparently 2 years ago a home that we sold out-right and even received cash back had a foreclosure initiated. We are in the process of trying to buy a home at this time. Our credit report looks great score of 650 to 720. We were told we were pre-approved. the day before we were suppose to close we got a call saying we were denied because there was an embedded code the underwriter found stating that a foreclosure had been initiated.” “We were told that according to FHA guidelines, you must wait 3 years after a foreclosure. Is this true? Although it didn
September 10, 2012
FHA Loan Reader Questions: Is A Physician Statement Required as Proof of Income for Disability Compensation?
A reader asks, “I have been approved for an FHA home loan or so my loan officer told me. She said everything was good I had been approved, a closing date was selected and ten minutes later I get a text message from my loan officer that the underwriter requires one more document.” “I am on Social Security Disability, proof of all income was provided, but now the underwriter wants a letter from my doctor guaranteeing that my medical condition will not change for the next 3 years! No doctor can guarantee my health or anyone else’s, can the lender suddenly deny my loan? My doctor would look at me like I had totally lost my mind. Please help me with this.” Situations like this happen more often than you | more...
September 7, 2012
Seller Concessions, The Six Percent Limit, and Inducements to Purchase
In our last blog post we discussed a reader comment about seller concessions. The reader asked a two-part question; “Has the percentage of incentives a seller can offer a buyer with an FHA loan changed yet from 6% to 3%? What if appliances and other things have been requested by the buyer which were covered under a separate sheet not the official home sale offer sheet?” At the time of this writing the FHA limit is still six percent. Some borrowers may be wondering what is meant by “seller concessions”; the FHA loan rule book describes them as contributions of “up to six percent of the lesser of the property
September 6, 2012
Seller Concessions Limit on FHA Loans: A Reader Question
A reader asks, “Has the percentage of incentives a seller can offer a buyer with an FHA loan changed yet from 6% to 3%?
September 5, 2012
What Is the Maximum Loan for an FHA No Cash Out Refinancing Loan?
A common question about FHA refinancing loans has to do with no cash out refinancing loan maximums. What is the maximum loan amount a borrower can apply for with a no-cash out refinancing loan with an appraisal? According to HUD 4155.1 Chapter Three, in the section titled, “Maximum Mortgage Calculation”, the following rules apply: “The maximum