September 7, 2015
Happy Labor Day! We pause from our usual posts about FHA home loans to observe the holiday. Markets are closed today and reopen tomorrow, and our coverage of FHA loan news and mortgage rate news will resume on Tuesday. Have a safe and fun holiday!
September 5, 2015
It was a volatile week for mortgage loan rates in general. Many were looking to Friday as a big day for potential rate movement thanks to an anticipated jobs report. But when the Employment Situation report was released, it didn’t do much to rates as investors didn’t react to the data in ways that could have pushed the rates significantly higher or lower. And so we saw rates inching back down on Friday, with 30-year fixed rate conventional mortgages hovering between 4.0% and 3.875%, best execution. Rates had been closer to 4.0% for much of the week until Friday, though some lenders may have offered the low end of the current range depending on borrower qualifications. In all this week’s volatility and upward movement, FHA mortgage loan rates are still | more...
September 4, 2015
We get many questions about appraisals, valuation and related issues. Many of the questions that come to us in the comments section come from home buyers, but a few come from those who want to sell the house they purchased with an FHA mortgage loan. One recent question in that area came from a reader who wanted to know what the best way to repair cracks in a basement wall might be, and whether or not the home should be put up for sale before the repair process was completed. The only way we can respond to questions like that is to say that it’s outside the scope of what we write about on this blog, but those looking for answers to questions in cases like these won’t be satisfied | more...
September 4, 2015
We’ve been reporting on a series of rule updates, amendments, and modifications to FHA single-family home loan policy scheduled to take effect on September 14, 2015. The new FHA Single Family Housing Handbook, also known as HUD 4000.1, contains all the rules and requirements for the FHA single family home loan program. The FHA/HUD official site has a Frequently Asked Questions list that addresses questions about a variety of aspects related to HUD 4000.1. Some of those questions involve FHA policy that pertains to borrowers, some pertain strictly to the lender. For example, lenders may wonder what the FHA policy is with regard to becoming or remaining a participating FHA lender. The FAQ section addresses that specific issue with a list of guidelines that include the following under a section | more...
September 3, 2015
Borrowers who want to refinance may wonder which FHA refinance loans offer no credit check or new appraisal. Are such loans possible? The answer may depend on your lender and other factors, but let’s see what options are open: For starters, non-FHA loans refinanced under the FHA single family home loan program will always require a new appraisal and credit check. This is because the only refinance option for non-FHA mortgages (aside from reverse mortgages offered under the FHA program, which also require new appraisals and credit documentation) is the cash-out refinance option or the no-cash-out equivalent. Which leaves only FHA-to-FHA Interest Rate Reduction Refinance loans (IRRRLs) with a possible option to apply with no credit check or appraisal. But there’s a caveat with these loans–the FHA loan program does | more...
September 3, 2015
The FHA will launch the new FHA Single Family Home Loan Handbook, HUD 4000.1, on September 14th. There will be certain updates, changes, alterations and revisions of some FHA loan policy in the handbook, and the FHA/HUD have anticipated some frequently asked questions about existing or new policies contained in that handbook. In the days leading up to the launch, we’re covering some of those FAQ topics here. Some may apply to borrowers, some apply to lenders, and there are a variety of topics that may be relevant to both. One frequently asked question topic of concern to lenders is the question of how much, if any, work associated with an FHA loan can be contracted out to third parties. FHA loan rules that take effect on September 14, 2015 | more...
September 2, 2015
Mortgage rates have ranged from unchanged to slightly higher this week, depending on the lender. There is a great deal of volatility present and part of the unchanged-to-slightly-higher activity we’ve seen this week is due to a possible rate hike by the Fed as early as September. Our sources report no clear indication as to whether September is the month when interest rates finally do get a hike by the Fed, but a jobs report due out on Friday could be a strong indicator as to which way the Fed might go in the coming month. Or it may not, depending on the contents of that report. “Wait and see” is the going advice seems to include the word “lock” a great deal when it comes to deciding whether to | more...
September 2, 2015
We get plenty of credit-related questions about FHA home loans and refinance loans in our comments section. One recent question that came in has to do with late payments on financial obligations prior to filling out an FHA mortgage application. The reader mentioned having late payments in the last year in addition to having a credit score in the mid-500s. “Can this affect my chances for FHA loan approval?” is the most common of questions, and naturally the answer is dependent on circumstances. In general, FHA loan applications are best turned in when the borrower has a solid 12 months of on-time payments for all financial obligations. Borrowers with otherwise outstanding credit and/or “compensating factors” may find a lender more forgiving if there is an issue with credit history, but | more...
September 2, 2015
On September 14, 2015, a new FHA single-family home loan policy handbook takes effect. It’s known as HUD 4000.1 and has several updates, changes and revisions that will take effect on the 14th. There have been some frequently asked questions about some of the details found in the new handbook–the FHA and HUD have published some answers to those questions in anticipation of the launch date for the new rule book. Here are some of those examples as printed on the FHA/HUD official site–one of the top questions? Whether referral fees will be permitted for the origination of FHA single family mortgage loans. The answer: “The lender, or any of the lenders employees, must not pay or receive, or permit any other party involved in an FHA-insured mortgage transaction to | more...
September 1, 2015
FHA appraisals can be tricky to understand, depending on the outcome. For example, we get asked several times a year why an FHA appraiser required corrections on cracked or peeling paint on surfaces in a given home. The question is usually associated with the seeming cosmetic nature of these corrections. “Why,” the readers will ask, “is this a must-fix when it’s just some paint peeling off a windowsill or door frame?” The answer in this particular case has a lot to do with lead abatement. Depending on the age of the home, lead paint may or may not be present. The FHA appraisal process requires mandatory correction of peeling paint in order to reduce potential or actual lead hazards. It’s true that this could, in certain cases, be perceived as | more...