Articles by: Joe Wallace

Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.

Connect with Joe:

April 19, 2023

FHA Home Loan Pre-Approval: Issues To Consider

By Joe Wallace

Getting mortgage pre-approval is an important step in the home buyer journey. It indicates to the seller and a lender that you are serious about your home loan and ready to commit to the right property and price. So what should you know about mortgage pre-approval before you apply? Before you start filling out the forms to get pre-approved, there are some basic questions to ask yourself. Getting pre-approved for an FHA home loan means asking yourself how good your credit score is and how high your credit card balances are. It also means looking at your savings and how much you will need to come up with to meet FHA minimum downpayment requirements. It’s best to start asking these questions far in advance of your home loan so that | more...

April 14, 2023

Buying Your First Home With An FHA Mortgage

By Joe Wallace

First-time home buyers love hearing about the low down payment requirements for FHA mortgages, and the fact that FHA home loans allow you to apply for a mortgage with a government-guarantee that helps keep mortgage loan interest rates lower on these types of loans. But some other perks aren’t so obvious; did you know that with an FHA mortgage you are permitted to have your seller contribute up to six percent of the home’s price as closing costs? The seller can’t contribute to your down payment but can help with those closing costs. Your ability to use this option may be limited in housing markets where there’s a lot of competition for a small amount of housing inventory, but when there is less competition for individual houses, your ability to | more...

April 13, 2023

FHA Loans and Escrow Accounts

By Joe Wallace

When buying a home, there are situations where the FHA home loan transaction requires an escrow account. HUD 4000.1 has a specific list of rules and regulations that govern escrow and how it is to be used for purchasing or building a home. There are many scenarios where the lender will require an escrow account. A construction loan is a great example; you won’t be able to build a home without one. In general, when escrow is used, we learn the following from the FHA Single-Family Lender’s Handbook, HUD 4000.1: “The Mortgagee must collect a monthly amount from the Borrower that will enable it to pay all escrow obligations…” The escrow account must have sufficient funds for items including but not limited to the following: For repair completion, escrow rules | more...

April 12, 2023

Preparing For Your FHA Home Loan Application

By Joe Wallace

Do you want to buy a house with an FHA mortgage loan? Don’t forget some important steps to take long before you fill out an application (see below.) Some borrowers don’t realize the planning stage for a home loan can be lengthy; you’ll need to save money for expenses above and beyond your down payment. And you’ll also need to work on your credit before applying for the mortgage. Borrowers should not consider applying for a home loan until they know three basic things-their FICO scores, how much down payment might be required on the home, and how much loan the borrower can afford. FICO Scores: A Great Place To Start The FICO score issue is the first one to tackle. Your lender won’t be able to work with you | more...

April 7, 2023

Not-So-Hidden Costs Of Your FHA Loan To Save For

By Joe Wallace

It’s easy to miss an important detail or two when planning and saving up to buy a home. Some obvious expenses include your down payment, FHA loan lender’s fee, property taxes, and escrow. But some things sneak up on first-time home buyers. You’ll want to be ready for both the cost of the services (see below) and the need to pay for the services themselves. For example, did you know that the appraisal and the home inspection are two totally separate costs? Some do, some don’t, at least not at first. Inspections Fees and Appraisal Fees Lenders and real estate agents tend to use the word “inspection” when they really mean “appraisal.” Remember, an appraisal is NOT a home inspection no matter how often the lender calls it one. And | more...

April 6, 2023

Buying A Home? Questions To Ask

By Joe Wallace

Are you thinking about applying for a mortgage loan? Here are some important questions you should ask yourself before starting a loan application. Preparing for the issues raised below can help you get off to a good start. Have I Saved Enough For Contingencies? There are plenty of costs some borrowers do not anticipate when planning and saving for their FHA mortgage. You should expect title transfer fees, pest inspection costs, and home inspection fees. These are all standard costs associated with buying a home. But there are also fees that are easy to forget about. Will you have to pay any property taxes at closing time? What about compliance inspection that may be needed after appraisal-required corrections are made as a condition of loan approval? How Much Negotiating Can | more...

April 5, 2023

FHA Home Loans: A Variety Of Options

By Joe Wallace

There are many different types of real estate available to purchase or refinance with an FHA single family home loan. Did you know that FHA loans are not limited to traditional suburban-type housing? Your options are as diverse as the kinds of real estate you might consider purchasing. For example, while an existing construction suburban home is definitely an option with FHA loans, you can also consider a new construction home. The difference between new and existing construction can be technical; new construction properties have generally been completed for a year or less and have never had an owner. So while you may not be interested in a “build-to-suit” new construction loan, you may be able to get a new construction loan for a property that is already finished but | more...

April 3, 2023

FHA Home Loan Preparations

By Joe Wallace

When you are preparing for an FHA loan, or an FHA refinance loan, what can you do to get ready? How long should it take you to prepare? These are two important questions to answer long before you complete an application for your loan. Generally, it’s best to start saving and budgeting as early as possible before your loan. FHA-required appraisals cost money, as do compliance inspections, flood insurance, and other expenses. At a minimum, borrowers should begin pulling their credit reports and insuring all payments on all financial obligations are made on time, without fail at least 12 months in advance. Depending on the type of home loan, you may need to get credit or home buyer’s counseling. For FHA Home Equity Conversion Mortgages or HECM loans, counseling is required | more...

March 30, 2023

Buying A Home? Ask Your Seller and Lender These Questions

By Joe Wallace

If you are buying your first home, you’ll want to ask some important questions of both the seller of the house and your participating FHA lender. The lender questions should include asking about the option to buy down your interest rate with discount points, and how much your interest rate could be depending on FICO scores and credit history. You should ask the lender about options for both 15-year and 30-year mortgages even if its just to compare the rates and monthly payments. You should also ask what benefits might be available with a higher down payment and how much your lowest down payment might be based on an estimated sale price and your credit. Questions To Ask Your Seller Some people worry about haggling or even questioning a seller. | more...

March 29, 2023

Watching Your Credit Before Applying For Your Home Loan

By Joe Wallace

If you are not monitoring your credit ahead of a credit application, especially a big one like an FHA mortgage or FHA refinance loan, you likely are not ready to apply for that credit. You want to know what’s in your credit reports along with your FICO scores, and you need to review the accuracy of your credit report before the lender sees it. Some believe this can be done by pulling annual credit reports. That snapshot of your credit picture isn’t necessarily what your loan officer will be reviewing at loan application time. The lender will see the most current data available to them, and it’s not wise to leave things to chance when applying for a home loan. Credit Monitoring Can Help Credit monitoring is an important tool | more...