Articles Published in: October 2012

October 9, 2012

FHA Loan Reader Question: Why Couldn’t I Qualify For an FHA Loan?

A reader asks, “I have really been working on my credit to be able to purchase a home. My scores are 618 – 595 – 540. I paid my student loan off in full. I went and got a unsecured credit card to help boost my scores…when people check your credit the numbers roll back…I have an auto loan for just over a year that is in good standing.” “I also paid off 2 vehicles and have been at my job now for just over 16yrs….Why, Why, Why couldn’t I qualify for this loan?” There are a number of reasons why a borrower might not be approved for an FHA mortgage, but in this reader’s case the FICO score could be one of those reasons. Why? According to FHA loan | more...

October 8, 2012

HUD Reaches Settlement in Pennsylvania Discrimination Case

By Joe Wallace

On the FHA/HUD official site you’ll find a press release announcing a settlement in a discrimination case against a Pennsylvania company that allegedly discriminated against families because of their national origin. According to HUDNo.12-160, “The U.S. Department of Housing and Urban Development (HUD) announced today that it has reached a Conciliation Agreement with the Lancaster, PA-based Ecklin Group that will end an alleged policy of refusing to rent to Burmese refugee families.” The press release adds, “The agreement is the result of a complaint HUD initiated against the Group after company staff allegedly failed to renew the leases of three Burmese families because of their national origin, and made statements to various people that the group would no longer accept rental referrals for refugees that were referred by Lutheran Refugee | more...

October 5, 2012

FHA Loan Reader Questions: Modular Homes

By Joe Wallace

Paragraph A reader asks, “Can a modular home on a full foundation be considered for an FHA loan?” A reader asks, “Can a modular home on a full foundation be considered for an FHA loan?” In general the FHA offers two types of home loans for manufactured housing. Here’s a quote from a frequently asked questions list on the FHA official site at FHA.gov: “How about manufactured housing and mobile homes? Yes, FHA has financing for mobile homes and factory-built housing. We have two loan products – one for those who own the land that the home is on and another for mobile homes that are – or will be – located in mobile home parks.” FHA loan rules do have provisions for modular homes (which are also considered factory-built houses); | more...

October 4, 2012

The FHA Anti-Flipping Waiver: Due To Expire Soon?

By Joe Wallace

In 2001, the FHA issued a press release about a waiver of FHA anti-flipping regulations. The press release, HUDNo11-292 issued on December 28, 2011 stated; “In an effort to continue stabilizing home values and improve conditions in communities experiencing high foreclosure activity, Acting Federal Housing Administration Commissioner Carol J. Galante today extended a temporary waiver of FHA

October 3, 2012

Things You Should Know About FHA Refinance Loans: The Basic Details

By Joe Wallace

Refinancing an FHA mortgage is similar to refinance loan on other types of mortgages such as conventional loans or VA loans. Naturally the FHA has its own list of requirements and regulations that govern refinance loans; do you know the basics as well as you should? If you’re considering an application for an FHA refinance, here are a few general things you should know about going into the process. In the FHA loan rulebook under the section, “Purpose of a Refinance Transaction” we learn, ” A refinance transaction is used to pay off an existing real estate debt with the proceeds of a new mortgage; –for borrower(s) with legal title, and –on the same property”. The rules also state that an FHA borrower is “eligible to refinance the loan, as | more...

October 2, 2012

Is a Borrower Ever Automatically Ineligible for an FHA Home Loan?

By Joe Wallace

FHA home loans are designed to help eligible borrowers get into affordable mortgages. The general credit qualifying criteria and loan terms can be far more lenient than some conventional mortgages, and the FHA loan program has helped many who could not qualify for conventional loans because of large down payment requirements or other terms. But is there a time when a potential FHA loan applicant is automatically ineligible for an FHA mortgage? According to the FHA, the answer is yes. For the purposes of this blog post, we aren’t talking about those who have experienced a foreclosure or who have filed bankruptcy; after all, there is only a mandatory waiting period–the seasoning period–that must be waited out until such borrowers are eligible to apply again. They haven’t been forbidden from | more...

October 2, 2012

FHA Loans: Credit References

By Joe Wallace

It would be easy to assume that a borrower with little credit history, or non-traditional credit history, is not eligible for an FHA guaranteed mortgage. But this isn’t necessarily true–the FHA has a set of requirements for those with little credit history or non-traditional credit. In typical FHA loan cases, the borrower would submit credit card information, plus details on any student loans, car payments, rent, or other financial obligations. Borrowers who have alternative credit references can still apply and be considered for an FHA mortgage, thanks to a set of requirements for credit references that might be considered non-traditional. Borrowers should not give up on pursuing an FHA home loan just because they don’t have typical credit–as you’ll read below, there is much more that can be used on | more...

October 1, 2012

FHA Loan Restructuring: A Reader Question

By Joe Wallace

A reader asks, “Is there any program (modification), that can lower my payment, restructure a unfair loan, which I can qualify for considering I just got discharged from Chapter 7 so I can afford my other bills? I have been denied for modifications, through my lender, and denied on two time consuming demands from lenders before the bankruptcy. My mortgage takes most of my income.” FHA loan modifications must be done through the lender–no private third party is authorized to restructure another financial institution’s loan without its participation. However, there are home loan modification programs sponsored by the government, such as HAMP (the Home Affordable Modification Program) that work with a participating lender. HAMP is aimed only at certain types of home loans, though VA and FHA loan programs may | more...