Articles Published in: March 2021

One Time Close Mortgage Loans: The Base Home Sales Price

March 31, 2021

One-Time Close Construction Loans: Loan Limits

Are you a house hunter who has gotten tired of looking at other people’s dream homes? Do you want to build your home instead of buying someone else’s? The One-Time Close construction loan is a good option for this; the One-Time Close loan eliminates the need for a second loan application and approval process compared to some other types of construction loans. There is more than one type of One Time Close mortgage to choose from–you could be eligible for a One-Time Close construction mortgage in multiple programs. Do you know which one is best for you? USDA One-Time Close Construction Loans We start with the need-based construction loan program offered by the USDA. The USDA One-Time Close construction loan program was created for borrowers on restricted incomes. This construction | more...

March 30, 2021

What Can Kill An FHA Home Loan?

By Bruce Reichstein

Those who want a home loan have to prepare for the new loan application in several ways–financially, through saving up for the down payment and closing costs, and with credit prep. That can mean working on your record of on-time payments, lowering your overall debt amounts, and avoiding new credit in the meantime. When applying for any large line of credit, there are some things that can stop your loan dead in its tracks. If you want a home loan and are worried about being approved for a home loan, add these issues to your mental not-to-do checklist and make sure you know how to avoid them. Avoid New Debt Your lender pulls your credit when you apply for your home loan–most people know that. But not as many know | more...

FHA Construction Loan Rule Changes In 2021

March 29, 2021

VA One-Time Close Construction Loans For Veterans

By Joe Wallace

Military members and veterans alike do well to explore their One-Time Close options to build a home instead of buying an existing house. There is an FHA One-Time Close loan veterans can use, but there is also a VA One-Time Close construction loan that is more idea for military members and veterans due to the zero-down option for the VA construction loan. Veterans and currently serving military members who are on the fence as to whether they should build or buy should explore their One-Time Close options in addition to looking for existing construction. The VA One-Time Close construction loan, sometimes referred to as a single close construction loan, can provide a distinct financial advantage for military families, retirees, and those who are about to retire or separate from military | more...

March 26, 2021

HUD Announces Settlement In California Housing Discrimination Case Involving G Davi Properties

By Joe Wallace

The Department of Housing and Urban Development has announced an agreement in a Fair Housing Act discrimination case. A conciliation agreement between a California resident and rental property owners/managers G Davi Properties and Guido A. Davi II. This agreement addresses housing discrimination claims made by the resident that the housing providers denied the resident’s request for reasonable accommodate related to the use of an assistance animal. Assistance Animals Are Permitted Under The Fair Housing Act It is a violation of the Fair Housing Act for housing providers to deny such accommodations when deemed necessary to “use or enjoy” housing. A press release issued by HUD elaborates on this, stating: “The Fair Housing Act prohibits housing providers from discriminating against people with disabilities, including refusing to make reasonable accommodations in policies | more...

March 25, 2021

Uses For An FHA Cash-Out Refinance Loan

By Joe Wallace

If you are thinking about applying for a cash-out refinance loan, you likely have some ideas about what you want to use the money for. FHA Cash-Out refinance loans allow the homeowner to convert equity built up in the home and take it out in cash. The amount of cash back is determined once the original loan and the closing costs of the new loan have been dealt paid. How to use the money? Some want an FHA cash-out refi to do home improvements with no restrictions on how the cash gets used. These loans don’t have the same restrictions on how the funds are used when you compare them to the FHA 203(k) Rehabilitation loan which allows a refinance and improvements to be made using loan funds. But | more...

Construction Loan Advice For New Borrowers

March 24, 2021

FHA Loan Down Payments: Some Simple Rules

By Bruce Reichstein

What do you need to know about FHA loan down payment requirements? First, in most cases, a down payment is required, and your down payment requirements are dictated in part by your credit scores. But you also need to know that your down payment could be waived if you are applying for a construction loan and have land equity to use instead. There are FHA loan rules you should know while you are still in the planning stages of an FHA purchase loan. These will help you decide what to do about saving up for a down payment and dealing with certain closing costs. Basic Down Payment Rules As stated above, FHA loan rules usually require a minimum 3.5% down payment for all single-family mortgage loan transactions. But don’t overlook | more...

March 23, 2021

Preparing Your Finances For An FHA Mortgage: Debt

By Joe Wallace

The debt-to-income ratio is a calculation that your lender will use to determine the amount of your monthly financial obligations compared to the amount of income you have. The debt-to-income ratio is an important tool for the lender. The more income you have compared to outgoing payments every month the better, your lender needs to justify you as a good credit risk. So how do borrowers with a lot of debt deal with this problem? This is an important factor because if the ratio is too high yor lender can’t justify the loan. Borrowers should learn what the FHA considers to be “debt” and what things are not automatically counted as part of your debt ratio in order to view their finances the way the lender will. FHA Home Loans | more...

March 22, 2021

FHA Loan Approval: Credit Scores Are Just One Factor

By Bruce Reichstein

Some house hunters worry that they don’t have credit scores good enough to qualify for the mortgage. But it’s easy to lose sight of the fact that FICO scores are not the single determining factor in home loan approval. There Are THREE Important Factors Some FHA loan applicants come to the process knowing that both FICO scores and your record of on-time payments are crucial for loan approval. But even this is an incomplete picture of what your lender is after when trying to approve your home loan application. By this point in our article, you are likely getting the hint that there is indeed a third factor that counts when applying for a mortgage loan, and that factor is your debt-to-income ratio. The participating FHA lender’s job is to | more...

March 19, 2021

HUD Announces Settlement In Wells Fargo Housing Discrimination Case

By Joe Wallace

The Department of Housing And Urban Development has announced a settlement in a housing discrimination case involving Wells Fargo. According to a press release on the HUD official site, Wells Fargo allegedly denied a mortgage loan intended to be used on a group home for persons with disabilities. While this specific case doesn’t seem relevant in the context of an individual applying for a home loan, any form of discrimination in the housing process weakens that process for all borrowers. The HUD official site reports that HUD has approved what is called a Conciliation Agreement between Wells Fargo Bank and a customer named in the complaint. The agreement resolves that customer’s claim that Wells Fargo denied a loan application after learning the loan was intended for the group home for | more...

Home Loans For Building On Your Own Land

March 18, 2021

One-Time Close Construction Loan Advice For New Borrowers

By Joe Wallace

If you have never explored your options to build a house on your own lot with a One-Time Close construction loan, you might be surprised to learn that these loans are open to first-time borrowers and experienced home owners alike. Construction loans have great advantages for those who want to build a primary residence. But there are often important questions borrowers need to be answered before they can make an informed decision on building on their own lot. VA One-Time close mortgages for military members and veterans offer a no downpayment option, and FHA One-Time Close mortgages have a low 3.5% downpayment requirement. And the down payment issue is where we get started with our home loan advice. Down Payment Assistance For Construction Loans Most FHA and VA participating lenders | more...