Articles by: Bruce Reichstein

October 20, 2021

Who May Contribute To My FHA Home Loan? Interested Party Contributions

Who my contribute to my FHA home loan? That is a question many want to know, and the answers don’t always point to the most obvious type of contribution the borrower may seek-the FHA mortgage loan required down payment. How much and to which areas can an interested party contribute to for the borrower’s FHA mortgage? FHA loan rules governing this topic are found in HUD 4000.1, the FHA Loan Handbook for single-family mortgage loan transactions. To begin, it should be noted that down payment source funds are strictly regulated and must come from a verifiable source the lender can investigate to make sure FHA loan rules have been followed. In general, down payment contributions cannot come from interested parties to include “sellers, real estate agents, builders, developers or other | more...

October 15, 2021

Credit Scores For An FHA Home Loan: When Low Credit Is Not Bad Credit

By Bruce Reichstein

Are you worried about your credit scores for an FHA home loan? When is a low credit score a reflection of bad credit behavior? FHA home loan rules specify that the lender must ensure a borrower as a 500 FICO score at the very minimum in order to qualify for an FHA mortgage, but your credit score numbers don’t tell the whole story. It’s true that FHA loan rule minimums for FICO scores do not always reflect the participating lender’s credit score requirements; borrowers are technically eligible for an FHA mortgage with the lowest possible down payment if they are applying with FICO scores at 580 or higher. The lender may require a credit score of 620 or higher for the same applicants. But your FICO scores only make up | more...

October 13, 2021

FHA Streamline Refinance Tips

By Bruce Reichstein

Are you interested in a lower interest rate on your home loan? What about a lower monthly payment? Or perhaps you are in an adjustable-rate mortgage and are looking for a way out before your next rate adjustment? These are all motivations to refinance. You’ll read plenty online about what it means to apply for an FHA Streamline refinance, but what do you need to know aside from the things EVERY home loan website talks about? Yes, FHA Streamline Refinance loans are for existing FHA borrowers only. Yes, FHA Streamlines normally require the borrower to get a tangible benefit from the loan like a lower rate, a lower monthly payment, etc. Yes, FHA Streamlines have no FHA-required credit check or appraisal requirement. And yes, the lender is free to require | more...

October 8, 2021

Important Issues About Buying A Home With An FHA Loan

By Bruce Reichstein

What are your concerns about buying a home with an FHA home loan? For some, it’s about how much the loan will cost month-to-month, while for others the issue of the loan’s long-term cost can be a worry. If you aren’t sure how the FHA home loan program works, you’ll definitely want to read on. What You Can Buy With An FHA Mortgage In general, FHA home loans are for owner/occupiers who want to buy a home to use as their primary residence. You can buy a property with as many as four units as long as it meets FHA minimum standards and you are financially qualified for the mortgage loan. FHA loan applicants may apply for any type of FHA loan offered by a participating lender including mobile home | more...

October 1, 2021

FHA Mortgage Relief Announced For Vermont Disaster Areas

By Bruce Reichstein

In many cases, the FHA and HUD make announcements about disaster relief after tropical storms, hurricanes, forest fires. But you don’t have to experience a Category 3 hurricane to be severely affected by weather; one excellent example of this comes with the HUD announcement of federal disaster assistance for parts of the State of Vermont that were in the path of severe storms and flooding at the end of July 2021. On September 29, 2021, there was a Presidential Major Disaster Declaration for two Vermont counties–Windham and Bennington. Thanks to that Presidential declaration, HUD has offered an automatic 90-day foreclosure moratorium for those two counties–this affects those with FHA mortgages, “commenced on the date of the Presidential major disaster declaration, and foreclosures of mortgages to Native American borrowers guaranteed under | more...

September 27, 2021

Buying A Condo With An FHA Mortgage

By Bruce Reichstein

Are you interested in buying a condo unit with an FHA home loan? It’s an option some borrowers don’t realize they have–some make assumptions about the FHA home loan program and the availability of loans for condo units. But the fact is that an FHA mortgage can be used to purchase a condo the same as any suburban home though there are some considerations to remember when making this type of purchase. FHA condo loans feature the same basic qualifying terms as other FHA mortgages for mobile homes, suburban homes, etc. This type of FHA mortgage is, like all other FHA mortgages, open to first-time buyers AND those who have owned a home before (even in the last three years). You will be approved for the FHA condo loan based | more...

September 22, 2021

Buying A Home: Your Down Payment

By Bruce Reichstein

What are the rules for FHA loan down payments? Some first-time homebuyers looking for a first home don’t realize you can’t just make the down payment by providing a check to your lender. There are strict rules about down payments–they must come from approved sources, they must be accompanied by any supporting documentation showing where the money comes from, etc. You, the borrower, are allowed to apply for a home loan and make a down payment on the house you make an offer on, but when you make that down payment you must document the sourcing of the money. As in, where did it come from? A cashed-in investment? That’s permitted under FHA loan rules. Did your down payment money come from a pink slip loan or a credit card | more...

September 17, 2021

FHA Loans Versus Conventional Home Loans

By Bruce Reichstein

If you are planning to look at real estate listings soon or use the help of a realtor to locate a new home, here are some questions to ask yourself about your new home loan; the answers will help you decide whether to pursue an FHA mortgage, a conventional loan, etc. FHA Mortgage Versus Conventional Home Loans: Compare Down Payments Make sure you know your FICO scores in advance of comparing down payment requirements since the amount of cash you will be required to put down is affected by credit scores when those scores are below a specific cutoff. There is more than one standard for FICO scores in this area-FHA loan minimums and lender requirements. Lender standards will apply no matter whether you are applying for FHA or conventional | more...

September 10, 2021

Your FHA Mortgage And Natural Disasters In 2021

By Bruce Reichstein

In the early days of the month of September, the FHA and HUD have made a number of announcements regarding disaster relief for portions of the country that have experienced fires, floods, and hurricanes. The agencies have, from the start of September to September 10, 2021, issued no fewer than seven announcements related to disaster relief. The first of those, dated September 1, 2021, includes the following related to disaster relief measures for those who are in presidentially declared federal disaster areas: Foreclosure relief – There is an automatic 90-day moratorium on foreclosures of Federal Housing Administration (FHA)-insured home mortgages beginning on the date of the major disaster declaration; Call the FHA Resource Center at 1-800-304-9320 for assistance FHA Rehab Loans — FHA Section 203(h) Rehabilitation Loans for disaster victims | more...

September 9, 2021

Do You Have An FHA Adjustable Rate Mortgage?

By Bruce Reichstein

Do you have an FHA adjustable-rate mortgage, also known as an FHA ARM loan? Is your introductory rate about to expire? It may be a very good idea to explore your refinance options to avoid the higher interest rate. Borrowers with adjustable-rate home loans rightfully get a bit nervous when the end of their introductory interest rate period, also known as a “teaser rate” period is about to and the first adjustment to the ARM loan’s interest rate becomes due. Borrowers can negotiate an introductory rate that lasts as little as one year and as many as 10 years with the lender, but eventually, that initial rate will end and the first adjustment will come due. If you have an FHA ARM loan you may be eligible for either a | more...