Articles in Category: Fixed Rate Mortgage

July 11, 2017

When Is An FHA Loan Better Than A Conventional Loan?

When is an FHA loan better than a conventional loan? Many potential FHA borrowers ask this question. Do you know how FHA loans stack up against their conventional loan counterparts? Purchase And Refinance The FHA Single Family Loan program features loans for both new purchases and refinancing. If you are considering a refinance loan in your home buying strategy, an FHA mortgage may be the right move for you. If you buy FHA and refinance FHA, you can take advantage of the FHA-to-FHA only Streamline Refinance loan to get into a lower mortgage payment and/or interest rates. We’ll cover the refinancing aspect of FHA mortgage loans more closely in another blog post. FHA Loan Interest Rates FHA home loans feature interest rates that are often competitive with their conventional loan | more...

July 6, 2017

Who Should Get An FHA Loan?

By Bruce Reichstein

Who should get an FHA loan? There are a variety of options with FHA mortgages, and depending on your financial goals and needs, you may find an FHA mortgage is the right choice for you, especially if you are interested in lower interest rates, and a more competitive down payment requirement. FHA Loans Are For Those Who Need A Lower Down Payment You should get an FHA mortgage loan if the idea of paying as much as 10% down doesn’t work for you. FHA mortgage loans require a minimum 3.5% down payment, which is based on the adjusted value of the property you are purchasing. It is important to know that your credit history will play an important part in determining your down payment in some cases; borrowers who have | more...

June 27, 2017

What Is An FHA Loan Rate? FHA ARM Loans and Fixed Rate FHA Mortgages

By Bruce Reichstein

What is an FHA loan rate? We discussed this question in our last blog post-that the FHA and HUD do not set or regulate interest rates on FHA mortgages, the ability of the borrower to buy discount points in order to lower the FHA loan rate up front, and how a borrower’s FICO scores can affect the kind of mortgage rates offered by the lender. But there is still an important issue to cover-the difference between how fixed rate FHA mortgages work and how FHA adjustable rate mortgage loans (ARM loans) work. What are the primary differences between an FHA fixed-rate loan and an FHA ARM loan? FHA Fixed Rate Mortgage Loans FHA fixed rate mortgages feature one interest rate, negotiated up front between the borrower and lender. Once the | more...

What Is The FHA One-Time Close Program? Part Two

June 26, 2017

What Is The FHA One-Time Close Construction Program? Part Two

By Bruce Reichstein

What is the FHA One-Time Close / Single-Close Construction Program? In our previous blog post, we discussed the basics of this FHA construction loan program-what it means to the borrower seeking an FHA new construction loan and how having a single loan (instead of two loans as with typical construction loan situations) can be an advantage for the borrower. FHA One-Time Close mortgages are for those who want an FHA construction loan for a property that has yet to be built. They can be more complex than typical new purchase FHA loans, but for those who need a construction loan, One-Time Close has definite advantages. They include a single closing date, and an early mortgage loan interest rate lock that can potentially safeguard the borrower against rising mortgage rates should | more...

Is U.S. Citizenship Required For An FHA One-Time Close Construction Loan?

June 26, 2017

What Is The FHA One-Time Close Construction Program? Part One

By Bruce Reichstein

What is the FHA One-Time Close / Single-close construction program? Who is it meant for? These are questions with important answers for potential FHA borrowers who are interested in applying for an FHA mortgage to have property built for them instead of buying an existing construction property. One-Time close mortgages are construction loans that differ from standard construction loans in that there is a single closing date for the loan rather than the traditional two closing dates. The borrower saves money on a one-time close loan thanks to the single loan for construction costs, land purchase, and the typical expenses associated with a home loan. These savings work in ways you might not expect. One advantage of this type of construction loan is that the lender and borrower arrive at | more...

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

June 22, 2017

Who Qualifies For An FHA Loan? Part Two

By Joe Wallace

Who qualifies for an FHA home loan? Many borrowers want to know if they can get approved for an FHA mortgage even with low FICO scores, past mistakes on their credit history, or other issues. What does your lender have to see in your financial details in order to approve your home loan? FHA Borrower Credit Scores The main confusion over FHA home loan FICO score requirements comes when a potential borrower reads FHA loan program standards but doesn’t understand that lender standards may also apply. FHA home loan rules state that a borrower with a FICO score between 500 and 579 is technically eligible for an FHA home loan provided a larger down payment of 10% is made. But a borrower with a 500 FICO score may discover that | more...

June 22, 2017

What Is An FHA Loan And Who Qualifies?

By Bruce Reichstein

What is an FHA loan and who qualifies? These are common questions, especially for first-time home buyers looking at all their options from conventional mortgages to FHA loans. What Is An FHA Home Loan? Simply put, an FHA mortgage is a home loan that has been guaranteed by the government, making the mortgage safer for the lender and less expensive for the borrower. The FHA single family home loan program is designed for borrowers who are financially qualified with FICO scores at 580 or better for maximum financing. (Lender FICO score requirements may be higher than FHA minimums.) An FHA mortgage as described here is intended for owner-occupiers and is meant for primary residences. That means that time shares, vacation homes, and other occasional-occupancy properties cannot be purchased with an | more...

Time Is Running Out On Exterior-Only FHA Appraisals

June 21, 2017

Where Do You Get An FHA Loan?

By Bruce Reichstein

When you’re ready to apply, where do you get an FHA loan? There are plenty of misconceptions about the FHA home loan process, which usually get cleared up fairly quickly once you begin working with a participating FHA lender. But in the planning and saving stages of the loan, it’s good to know the facts about FHA loans, where to get them, and how they work. FHA Loans Are Offered By Participating Lenders Not all lenders participate in the FHA loan program, some are not permitted to participate, and some may not be certified by the FHA yet. Borrowers who need an FHA mortgage will need to find an active, participating lender who can qualify or prequalify the borrower for a mortgage loan. Participating lenders advertise their affiliation with the | more...

June 20, 2017

FHA Jumbo Loans

By Joe Wallace

FHA Jumbo Loans, also known as non-conforming loans, are mortgages that exceed the county limit for mortgage loans in that area. FHA home loans in excess of these limits (also known as FHA loan limits) are possible, but there are some important factors you should know about before applying. FHA Jumbo Loans Are Like “Standard” FHA Mortgage Loans Some borrowers want to know if they can apply for an FHA Jumbo Loan that exceeds the value of the home and take the remainder of the mortgage loan out in cash at closing time. FHA home loans are specifically designed to prevent cash back to the borrower at closing time except in the form of legitimate refunds. If you paid cash for something up front that was later financed into the | more...

June 14, 2017

How Is An FHA Loan Better Than A Conventional Loan?

By Bruce Reichstein

What are the major differences between FHA loans and conventional loans? Do you know why people choose FHA over conventional mortgages? There are many reasons, depending on the borrower, but let’s examine how FHA loans differ to see what advantages you may find with a participating FHA lender. FHA Loans Versus Conventional Loans: Interest Rates Depending on your FICO scores and other financial qualifications, you may be required to put as much as 20% down on a conventional mortgage loan. Compare that to the FHA-required minimum down payment of 3.5% of the adjusted value of the property. Down payment requirements can and often do depend on your credit score, and for FHA mortgages, HUD 4000.1 (the FHA Single Family Loan Handbook) states that borrowers with FICO scores 580 or higher technically | more...