Articles Published in: 2016

December 5, 2016

Higher FHA Loan Limits For 2017 Announced

The FHA official site has announced higher FHA loan limits for 2017. According to a press release on the official site, The Federal Housing Administration (FHA) today announced the agency’s new schedule of loan limits, and due to an increase in housing prices, most areas in the country will see a slight increase in loan limits in 2017 These loan limits are effective for case numbers assigned on or after January 1, 2017, and will remain in effect through the end of the year. The announcement includes word of a higher FHA national loan limit “ceiling”, which is set to increase to $636,150, up from 2016s $625,500 limit. The “floor” is also scheduled to increase in 2016 to $275,665, which is up from the previous years $271,050. Recent changes in | more...

December 5, 2016

Mortgage Rate Trends: Higher, Then Lower

By Joe Wallace

Since our last look at mortgage loan interest rate trends, rates spiked to 24-month highs (Thursday), but then recovered on Friday. Thursday’s move took 30-year fixed rate conventional mortgage loan rates to a range between 4.25% and 4.375% (best execution). But Friday saw the same rates move back down to at or near 4.125%, best execution. On both Thursday and Friday, FHA mortgage rates remained at 4.0%, but that’s up from a previous range that still had a bottom end in the sub-four percent zone. That is gone for now, but FHA rates, best execution, haven’t been in the four percent zone in quite some time leading up to the current upward trend. Friday’s rate recovery happened in spite of job report numbers that, in times past, have served to | more...

December 2, 2016

FHA Announces 2017 HECM Limits

By Joe Wallace

The FHA official site has been updated recently to include 2017 loan limits for Home Equity Conversion Mortgages, also known as FHA HECM loans or FHA reverse mortgages. According to the press release at www.FHA.gov, “The Federal Housing Administrations (FHA) Home Equity Conversion Mortgage (HECM) loan limits for Traditional HECM, HECM for Purchase, and HECM-to-HECM refinances are governed by the maximum claim amount limitation in sections 255(g) and 255(m) of the National Housing Act, which contains cross-references to section 305(a)(2) of the Federal Home Loan Mortgage Corporation Act”. The FHA updates HECM loan limits annually, and those updates are effective for the new calendar year; limits may be subject to change depending on legislation, FHA requirements, or other legal factors that may apply before or after the existing year’s update | more...

What You Need To Know About Your FHA Home Loan

December 1, 2016

FHA Loan Applications in 2017: Are You Ready?

By Joe Wallace

For potential borrowers thinking of filling out FHA loan applications in 2017, there are a number of areas to think about as you prepare. Some potential borrowers are ahead of the curve when it comes to getting financially ready for a major loan application, while others may overlook important areas that need attention long before the loan paperwork is filled out. Do you know how ready you are to fill out that mortgage loan application? One question to ask yourself before the new year arrives is how long youve been planning and preparing for the new loan. Many financial experts advise taking at least a full year to save, budget and research the new loan. Why is research needed? In several ways, doing some research can help you decide what | more...

December 1, 2016

2017 FHA Appraisal: When Do You Need One?

By Joe Wallace

If you aren’t sure whether you need a 2017 FHA appraisal, there may be a very simple answer depending on what kind of home loan or refinance loan you are seeking. For all “forward mortgages” including new construction, proposed construction, or existing construction loans, an FHA appraisal will be required. New purchase loans or forward mortgages require the lender to establish the fair market value of the property to be purchased. That’s where the appraisal comes in. An FHA appraisal establishes the fair market value and insures the home meets basic, minimum standards. The lender will calculate the loan amount based on either the fair market value of the home established in the 2017 FHA appraisal or the asking price of the home, whichever is lower. For new purchase loans, | more...

November 30, 2016

Mortgage Rate Trends: Slightly Higher

By Joe Wallace

Were giving additional time for mortgage rate trends this week in light of the sharply higher movement and attempts at recovery weve seen in recent days. Since our last report, mortgage rates have moved higher once more, but overall the best execution numbers are roughly about in the same range as mentioned in our last report. There are a variety of reasons for Wednesdays upward turn for rates. One factor is overseas economic news related to the OPEC deal, which in and of itself might serve to put some upward pressure on rates depending on investor reaction to those developments. However, the OPEC situation combined with domestic inflation fears related to the incoming President and his administration serves to dump more fuel on the fire. These two factors are cited | more...

Will My Home Loan Application Be Approved?

November 30, 2016

2017 Home Loans: Is Your Holiday Spending A Factor For An FHA Loan?

By Joe Wallace

Holiday credit card use tends to spike, and those considering 2017 home loans should take this into account when planning for a new mortgage loan application. Your credit card debt affects your debt-to-income ratio, which the lender will calculate at application time. That ratio, called DTI for short, is a very important factor in home loan approval. For some borrowers, the amount of credit card debt, even holiday spending, isnt as much of a problem as timely payments. Some consumers are tempted at holiday time to skip payments in order to free up some much-needed cash, but a missed payment within 12 months of your FHA mortgage or refinance loan application is not a good thing. Financial experts recommend borrowers maintain on-time payments with no late or missed payments for | more...

November 29, 2016

Mortgage Rates: Recovering

By Joe Wallace

Since our last report on mortgage loan interest rate trends, we saw 30-year fixed rate conventional mortgage rates hit 4.25% best execution (depending on the lender). That was something of a milestone in 2016 after many, many months of sub-four percent mortgage rates. But since that time, rates have recovered some lost ground and while the current best execution rates are still above the four percent mark, any news of lower rates at this point is welcome. 30-year fixed rate conventional mortgages are, at the time of this writing, reported at a best execution range between 4.125% and 4.25% depending on the lender. FHA mortgage loan rates are still within a range between 3.75% and 4.0%, best execution. As we always point out, the rates seen here are listed assuming | more...

How much can I borrow with an FHA refinance loan?

November 29, 2016

FHA Loans Closing Checklist

By Joe Wallace

Borrowers who buy a home with an FHA loans or any other type of home loan, learn that their closing dates and other details become very important the closer the borrower comes to signing on the dotted line and taking possession of the home. To help borrowers manage all the details about closing, federal law requires the loan officer to provide a closing disclosure that details expenses, fees, and other information. The government’s watchdog agency, the Consumer Financial Protection Bureau (CFPB) at ConsumerFinance.gov says of this disclosure, “Lenders are required to provide your Closing Disclosure three business days before your scheduled closing. Use these days wisely”. The three day period before you close should be used to review your closing details-use it like a closing checklist to make sure everything | more...

November 28, 2016

The Debt To Income Ratio: FHA Rules In 2017

By Joe Wallace

If you are thinking about your FHA loan options in 2017, one area to pay special attention to (especially over the holidays) is your debt to income ratio (DTI). This ratio is one of the most important factors in the lender’s decision to approve or deny a home loan-it can be just as crucial as your FICO scores. The debt to income ratio is a calculation your lender will make by taking the amount of verifiable income you have and comparing it with the amount of your monthly financial obligations. This ratio is calculated with and without your proposed mortgage payment in order to determine if you can afford the loan payments every month. How does the lender make these calculations? According to HUD 4000.1, pages 177 and 178: “The | more...