Articles in Category: Fixed Rate Mortgage

January 31, 2024

How FHA Mortgages Compare To Conventional Loans

How do FHA mortgages stack up to their conventional loan counterparts? Typical down payment issues are the most obvious comparison. The FHA has a 3.5% requirement, and conventional loan requirements vary. There are some important differences to know before you choose which mortgage loan is best for your needs. FHA Loan Best Practices FHA mortgages have two sets of rules. FHA loan program guidelines but also, lender standards like all mortgages. The FHA requires its participating lenders to keep policies that benefit the borrower. One example is the loan rule requiring ZERO penalties for early payoff of the loan. Another perk? The option to refinance later with an FHA no-credit-check streamline refinance loan option. Not all borrowers may want this option (no cash out is allowed) depending on what kind | more...

January 29, 2024

What You Need To Know About FHA Loan Closing Costs

By Joe Wallace

How much cash to close do you need for an FHA mortgage? Many sources cite a number between 2% and 6% of the purchase price. Borrowers typically need to learn how much home is affordable early in the planning stages. Make these calculations as early as possible to help you save for both the down payment and closing costs. How Much You Can Afford To Borrow? An online mortgage calculator can help you get an idea of how much loan to apply for. Borrowers may be tempted to view that number as being flexible but that can come with a price. Beware of what some call “cost creep.” A little leeway on a service cost, a higher-than-expected expense, and over time it’s possible to find yourself moving outside your budget. | more...

January 26, 2024

What You Should Know About FHA Loans And Lender Standards

By Joe Wallace

What you should know about FHA home loans and lender standards includes the basic concept that FHA loan minimums are not the only rules that affect your home loan transaction, whether it’s a one-time close construction loan, a reverse mortgage, or even a cash-out refinance. FHA loan rules are not designed to address all possible scenarios when dealing with a home loan application. FHA loan rulebooks do not include the state/municipal guidelines and requirements for every housing market. FHA mortgage loan rules in HUD 4000.1 provide some leeway and flexibility for the lender to interpret the rules in light of lender requirements, as long as those requirements are per federal law and FHA guidelines. Then there’s state law, local building code requirements, and local ordinances that must be satisfied. FHA | more...

January 22, 2024

Getting A Better FHA Loan Interest Rate

By Joe Wallace

CBS News offers some advice to house hunters in 2024. Are you interested in buying a home with a lower interest rate? CBS has some advice for you, and as their published article reminds us, mortgage rates are falling in early 2024, but there are also ways to enhance your ability to get a lower rate. The CBS report dispenses some advice to help homeowners take advantage of existing options that can earn qualifying borrowers an even lower rate. But is the CBS advice sound? We examine their perspectives on getting a better rate on your home loan below. Shopping Around For A Lender CBS advice includes the idea that it’s best to shop around and find a lender offering the most competitive FHA loan rates and terms. Consider shopping | more...

January 17, 2024

FHA Home Loan Options In 2024: Build, Buy, Or Wait?

By Joe Wallace

2024 may be the year more people think about owning a home thanks to anticipated lower mortgage rates and more homes for sale. Which option is best for you when finding a new place to live? There’s no one-size-fits-all answer, but some options are more tempting than others. Renting Options If You Aren’t Ready Yet Renting in 2024 may be an option to consider IF you are not quite ready to commit to a home. Borrowers sometimes underestimate how long it takes to get fully ready for a mortgage and if you are just now exploring your credit, lender options, and saving up for the down payment. However, some market watchers believe rental inventory may be lower this year, and there could be more competition for rental properties overall. Are | more...

January 8, 2024

Buying Your First Home With An FHA Mortgage

By Joe Wallace

What can a new borrower expect from the home loan process? There is a learning curve to think about, especially for borrowers unfamiliar with loan terms and industry jargon. Some of these loan terms and issues may not be immediately apparent (see below), but as you learn about the home loan process, they become more easy to understand and more important to know. Here are some of the issues you need to keep in mind as you start your home buying journey. Appraisal Versus Inspection First-time home buyers soon learn, one way or the other, that lenders and other industry professionals sometimes use “appraisal” and “inspection” interchangeably. Borrowers should expect to pay for each of these. Don’t skip the inspection no matter how insistent the seller is that the appraisal | more...

January 3, 2024

Buying An Older Home With An FHA Loan

By Joe Wallace

FHA home loans come with a myth or two. For example, the notion that only first-time home buyers can get an FHA loan. That is a myth. Also NOT TRUE? The idea that a house can’t be past a certain age to qualify. This myth isn’t as widespread as the first-time home buyer one, but the fact is, only SOME property types have a specific age requirement Manufactured homes have a specific age requirement other FHA loans don’t carry. An FHA-eligible mobile home or manufactured housing must be built after June 15, 1976 or it cannot be purchased with an FHA mortgage. Existing construction properties under the FHA single-family home loan program don’t have that age issue. Age or Remaining Life? The FHA lender’s handbook specifies that all houses purchased | more...

December 27, 2023

What To Ask A Lender When Shopping For A Mortgage in 2024

By Joe Wallace

First time home buyers often have plenty of questions to ask a lender. Below we examine some of the key issues to consider when you compare financial institutions. Shop Around For A Lender And The Right Loan Compare three lenders (more is better) and don’t shortchange yourself when you start the process of shopping around for the right lender. It’s better to take more time and find the right match for you. Remember, you don’t have to use your current lender even if you have other loans with them. Ask About FHA Loan Rates and Terms You want to know these long before you make offer on a house. You’ll want to get an early sense for how much your loan may cost so you can plan your loan. Ask | more...

December 22, 2023

FHA Loan Prep Versus Holiday Spending

By Joe Wallace

House hunters who want a home in the new year, have many financial issues to worry about. One seasonal issue is holiday spending, and if you overextend yourself in December it can lead to more than financial stress. Fortunately, there are things you can do to manage credit issues and keep them from being a liability at loan application time. Don’t Allow Missed Payments What makes a late or missed payment can vary depending on the creditor. Do you know the current due dates on your bills? Have you arranged to make a partial payment rather than miss the deadline if you can’t make the full payment? These are all steps that can help you get closer to a loan next year. Consider How You Pay In 2024 Paying with | more...

December 20, 2023

Factors To Consider When Buying A Home In 2024

By Joe Wallace

Many Americans are considering new options for housing in 2024. The new year may be shaping up as a good time to reconsider options for home ownership. Are you ready to stop renting and start owning? Many would-be house hunters read headlines in late 2023 about when a housing recovery will happen, the fact that the Fed decided not to raise interest rates, and talk that inflation may be slowing or stopping. And then there are the market forces (including lower home loan rates) that are coming together to bring more potentially positive change. What do you need to know about buying a home in the new year? For a start, the fact that tou don’t have to be a first-time home buyer to use an FHA mortgage to buy | more...