Articles Published in: December 2017

December 21, 2017

HUD Announces New Foreclosure Prevention Guide

The Department of Housing and Urban Development has announced a new publication aimed at helping home owners avoid foreclosure and fraud. According to a press release on the HUD official site, the Homeowners Guide to Success is part of a “public-private partnership between federal agencies and industry partners. The guide provides homeowners with information on the critical first steps to take if they are at risk of missing a mortgage payment or facing foreclosure.” Foreclosure avoidance is an important issue, and with 2017’s natural disasters in Texas, Puerto Rico, Florida, and elsewhere, there is an emphasis not just on borrowers taking steps to keep their homes, but also to become more aware about the potential for fraud and scams aimed at those who struggle to keep up with mortgage payments. | more...

December 20, 2017

What FHA Appraisal Issues Should I Know About?

By Bruce Reichstein

What FHA appraisal issues should I know about? That’s a question that likely doesn’t get asked enough, but the answers can help you make a more informed choice when buying a home. FHA Appraisal Rules For The Living Unit The FHA loan handbook spells out several basic requirements for the living unit which include (but may not be limited to) the following guidelines-the lender is required to insure each home has the following: -a continuing and sufficient supply of safe and potable water under adequate pressure and of appropriate quality for all household uses; -sanitary facilities and a safe method of sewage disposal. Every living unit must have at least one bathroom, which must include, at a minimum, a water closet, lavatory, and a bathtub or shower; -adequate space for | more...

December 20, 2017

What Is The Difference Between FHA Cash-Out And No Cash-Out Refinance Loans?

By Joe Wallace

What is the difference between FHA Cash-Out and No Cash-Out refinance loans? Aside from the obvious cash out option, there are several important differences in these two types of FHA refinance loans you should know about before you decide which one is right for you. FHA Refinance Loan Occupancy Requirements FHA loans generally require at least one borrower obligated on the loan to occupy the property as the primary residence as a condition of loan approval. But beyond that, cash-out refinance loans and FHA no cash-out refi loans have some other occupancy rules you should know. For FHA Cash-Out refinancing, HUD 4000.1 instructs the lender, “Cash-out refinance transactions are only permitted on owner-occupied Principal Residences. The Property securing the cash-out refinance must have been owned and occupied by the Borrower | more...

December 19, 2017

FHA Cash-Out Refinance Loan Rules

By Bruce Reichstein

FHA cash-out refinance loan rules include instructions to the lender that these refinance loan transactions can be used for both existing FHA loans and non-FHA transactions including conventional loans, VA mortgages, etc. There are some rules specific to FHA cash-out refi loans you should know about before applying. FHA Cash-Out Refinance Loan Payment History Requirement HUD 4000.1, the FHA loan handbook, states that the lender is required to document a cash-out refinance loan applicant’s payment history on the old mortgage loan. “The Mortgagee must document that the Borrower has made all payments for all their Mortgages within the month due for the previous 12 months or since the Borrower obtained the Mortgages, whichever is less. Additionally, the payments for all Mortgages secured by the subject Property must have been paid | more...

December 19, 2017

FHA-To-FHA Refinance Loan Rules

By Joe Wallace

FHA refinance loan rules include a set of general requirements that may vary depending on whether the mortgage is a non-FHA to FHA refi or an FHA-to-FHA refinance loan. Today we’ll examine some general rules for FHA-to-FHA refinance loan transactions. Who Can Refinance An Existing FHA Mortgage? FHA loan rules in HUD 4000.1 state that at least one borrower obligated on the FHA-to-FHA refinance transaction must hold the title to the property. This must be true before the FHA issues a case number for the mortgage loan. Refinancing A Manufactured Home With An FHA Mortgage HUD 4000.1 instructs the lender, “For a transaction involving a Manufactured Home to be considered a refinance, the Manufactured Home must have been permanently erected on a site for more than twelve months prior to | more...

December 18, 2017

What Should I Know About FHA Home Loans?

By Bruce Reichstein

What should I know about FHA home loans? The first thing to remember is that your options with an FHA mortgage include new purchase loans, reverse mortgages, refinance loans, and rehab loans. You can do a lot more than just buy a house as a first-time home loan applicant. FHA Home Loans Are Not Just For First-Time Buyers The most common misconception about FHA home loans is that they are ONLY for first-time buyers. This is not true. No matter how many times you have borrower money to buy a home before, if you are interested in purchasing a primary residence, the FHA home loan is an option for you. FHA Loans Include Mobile Home Loans and FHA One-Time Close Construction Loans The list of FHA home loan options include | more...

December 18, 2017

FHA Announces Reverse Mortgage Loan Limits For 2018

By Joe Wallace

The FHA has announced reverse mortgage loan limits for 2018. The agency recently posted the forward mortgage loan limits for 2018, and the update for FHA reverse mortgages comes as no surprise given the overall increases posted for next year’s loan limits by county for new purchase loans. The FHA reverse mortgage is also known as the Home Equity Conversion Mortgage, or HECM for short. According to the FHA official site, the maximum “claim amount limits for Traditional HECM, HECM for Purchase, and HECM-to-HECM refinances are governed by the maximum claim amount limitation” are found in sections 25 5(g) and 255(m) of the National Housing Act. “FHA publishes updated limits effective for each calendar year” according to the most recent mortgagee letter at FHA.gov. The new limits are, according FHA | more...

December 15, 2017

FHA Loan Options For 2018

By Bruce Reichstein

Exploring your FHA loan options for 2018? Whether you are a first-time home buyer or an experienced house hunter, FHA loans have something to offer. You don’t have to be in the market for a new home, either-there are refinance loan options to help you get into a fixed rate FHA mortgage. New Purchase FHA Home Loans For First Time Borrowers While there is no FHA-sponsored special deal for first time home buyers or first time borrowers, FHA loans offer excellent options including a lower required minimum down payment-only 3.5% of the adjusted value of the home down as the minimum. FHA loans can offer more competitive interest rates depending on the lender, the borrower’s financial qualifications, and other factors. You will need to work with your lender to negotiate | more...

December 15, 2017

HUD Announces Settlement In California Fair Housing Case

By Joe Wallace

The Department of Housing and Urban Development has announced a settlement in a California Fair Housing Act case. According to a press release on the HUD official site, HUD has entered into an agreement “with the owner and property manager of Shadowbrook Gardens Senior Townhomes in Morgan Hill, California, a city in Santa Clara County, resolving allegations that they discriminated against a resident with disabilities”. A tenant of that property, “requested to have a live-in aide and a key to a locked gate near her unit that would make it easier for her to come and go” according to the HUD press release, which adds that in each case, “the owner and property manager allegedly asked her intrusive questions about her disability, challenged whether she really had a disability, asserted | more...

December 14, 2017

Can I Get Cash Back On An FHA Mortgage?

By Bruce Reichstein

Can I get cash back on an FHA mortgage? That’s what some borrowers want to know, and the answer varies depending on the type of home loan you seek. FHA Cash-Out Refinancing Loans The FHA cash-out refinance loan is an FHA refi transaction designed to permit the borrower to take cash back at closing time. The amount of cash you get back on this type of loan depends on how long you have been paying on your home loan, and the amount of any add-ons to your mortgage such as financed closing costs, etc. You aren’t allowed to borrower more than the property is worth based on FHA appraisal guidelines and LTV limits. That means you can’t use a home worth $250,000 to secure am FHA cash-out refinance loan for | more...