Articles Published in: December 2017

December 29, 2017

Get Ready For Your FHA Home Loan In 2018

Get ready for your FHA home loan in 2018 with some simple planning, budgeting, and market research. Buying a new home-or having one built with an FHA One-Time Close construction loan-requires some advance planning and saving, but your new home is well worth the effort. How ready are you to apply for a home loan in the new year? Do Some Housing Market Research What are typical house prices in your area? How do those prices match your budget? You can use an online mortgage calculator to help you figure out how much an estimated monthly mortgage payment could be based on the price of the home, interest rate, the amount of your down payment, and other factors. Once you have your estimated monthly mortgage payment, you can decide if | more...

December 29, 2017

Get Ready For Your FHA Refinance Loan In 2018

By Joe Wallace

Get ready for your FHA refinance loan in 2018! Are you interested in a lower mortgage payment or interest rate on your home loan? Are you looking to convert the equity you’ve built up in your home into cash? Or perhaps you want to get out of an adjustable rate mortgage (ARM) and into a fixed rate loan? All of these options are open to financially qualified borrowers who apply for an FHA refinance loan. How To Prepare For An FHA Refinance Loan In 2018 Many of the same steps you took for your original home loan application will apply when you begin planning for an FHA refinance loan. You’ll want to pull your credit reports are early as possible in the planning stages, and consider active credit monitoring to | more...

December 28, 2017

FHA Rehab Loans and Appraisal Requirements

By Bruce Reichstein

FHA rehab loans have different appraisal requirements than FHA “forward” mortgages used to simply purchase an existing-construction property. Because the borrower is applying for a home loan to buy property that (likely) does not meet FHA minimum standards or state/local building code, the lender is required to determine both the existing condition of the home and the “after completion” version of it. What do FHA loan rules say about the appraisal process for this type of home loan transaction? Today we’re examining the rules for the FHA 203(k) rehab loan. We’ll cover rehab loan rules for properties in federally declared disaster areas in a separate blog post. FHA Appraisal Rules For 203(k) Rehab Loans As mentioned above, FHA loan handbook (HUD 4000.1) requires the lender to determine the value the | more...

December 27, 2017

What Are FHA House Loans?

By Bruce Reichstein

What are FHA house loans? Are they really only for first-time home buyers? There are many things about the FHA home loan program that are easily misunderstood. Let’s explore how FHA home loans can help you even if you are NOT a first-time home buyer. FHA Home Loans: What They Are Designed To Do FHA mortgages allow qualified borrowers to buy, refinance, and repair/rehab homes intended to be used as the buyer’s primary residence. FHA mortgages include options for cash-out and no cash-out refinancing, and there are rehab loans, FHA fixer-upper loans, FHA construction loans, and several other options. FHA loans can be used to buy suburban homes, condo units, mobile homes, manufactured homes, and modular homes. You can also apply for an FHA One-Time Close construction loan to have | more...

December 27, 2017

Is It The Right Time To Refinance My Home Loan?

By Joe Wallace

Is it the right time to refinance my home loan? The answer to that question depends on a variety of factors, but there are some things to remember no matter when you decide to refinance a home mortgage loan. A September 2017 report by Fortune.com includes data that indicates a general increase in home prices, including the observation of the “65th straight month that prices have risen year-over-year”. That same report mentions that “housing inventory declined for a 26th straight month on a year-over-year basis”. In housing markets where property values are going up, certain kinds of refinance loan options become more attractive. An FHA cash-out refinance loan makes more sense for borrowers who have more equity in the home; cash out refi loans require a new appraisal and if | more...

December 26, 2017

FHA Loan Rules: Appraisal Standards And Building Code

By Bruce Reichstein

Do you know the FHA loan rules for appraisal standards and compliance with building code? As a borrower, you may not need to know every single aspect of the FHA loan rules for appraisals, but understanding the basic concepts can help you make a more informed decision when it’s time to choose a home and a home loan. FHA Appraisal Rules: Some Basics The FHA appraisal is a tool for your lender to establish the fair market value of the property and to establish the adjusted value of the home for purposes of setting the loan amount. The appraisal is not a complete, in-depth, top-to-bottom inspection of the property and should never be used by the borrower as such. Only the optional, borrower-arranged and borrower-paid home inspection can do this. | more...

Rent Or Buy? Arguments For Purchasing A Home With An FHA Mortgage

December 26, 2017

What You Should Know About FHA Loan Down Payments

By Joe Wallace

What you should know about FHA loan down payments includes understanding the lender’s requirements for verifying the source of your down payment funds, and the fact that your down payment is not affected by other home loan fees or expenses. What do these things mean? The FHA Loan handbook, HUD 4000.1, has the answers. FHA Home Loan Down Payment Basic Requirements HUD 4000.1 tells the lender that the lowest possible down payment is 3.5% of the adjusted value of the property. This does not apply for HUD-owned “repo” homes also known as HUD REO properties. The rules for these homes includes the possibility of a $100 down payment (lender standards may also apply). The down payment is a condition of loan approval; the only FHA home loan “forward mortgage” for | more...

December 22, 2017

Happy Holidays!

By Bruce Reichstein

Happy Holidays! We’re pausing from our usual schedule of writing about home loans, mortgage trends, FHA and HUD news, and related topics in order to celebrate the holiday season with friends and family. From all of us here, have a fun and safe holiday season! Our normal schedule resumes on Tuesday, December 26. Thank you for reading!

December 22, 2017

Get Ready For An FHA Mortgage Loan

By Joe Wallace

Do you want to get ready for an FHA home loan in the new year? There are several things you can do now to prepare for your new mortgage loan application and get closer to home loan approval. Know Your Price Range For Buying A New Home Getting ready for an FHA mortgage in the new year means budgeting and saving up for home loan expenses including the FHA loan minimum required down payment. If you don’t know your approximate price range for purchasing a new home, saving up for your down payment may be harder-FHA loan rules state that the minimum amount down is 3.5% of the adjusted value of the property. Knowing your price range can help you determine how much to budget for your down payment. But | more...

December 21, 2017

What Credit Score Do I Need To Get A Home Loan?

By Bruce Reichstein

What credit score do I need to get a home loan? That is a question many FHA loan applicants ask, and the answer involves both FHA loan rules in HUD 4000.1 (the FHA loan handbook) and lender requirements. What You Should Know About FHA Loan Standards FHA loan rules for credit and FICO scores are minimum requirements, but your participating FHA lender may have additional requirements. Always remember that FHA loan rules provide the baseline requirements, but the lender may have higher FICO score and credit history standards. What we’re discussing here are the FHA rules, lender requirements will vary. The FHA “Minimum Decision Credit Score” (MDCS) HUD 4000.1 defines the FHA MDCS as follows: “The Minimum Decision Credit Score (MDCS) refers to the credit score reported on the Borrower’s | more...