Articles in Category: Fixed Rate Mortgage

April 28, 2015

FHA Mortgage Rate Trends: Higher Ahead Of Fed Announcement

Mortgage loan rates shot up to highs we haven’t seen in around a month–Tuesday rates pushed higher ahead of two important economic data releases on Wednesday that have potential to push mortgage loan rates in one direction or the other depending on investor reaction to the contents of those releases. Wednesday morning sees the release of numbers from the first quarter Gross Domestic Product report (in the morning) and an announcement from the Fed (in the afternoon). The Fed event will be watched carefully as markets will react to any news that indicates whether or not the Fed intends to raise interest rates. That would have an effect, depending on how investors respond to the information, of pressuring rates higher or giving them a chance to recover from today’s move | more...

April 24, 2015

FHA Refinance Loans For Investment Property? A Reader Question

By Joe Wallace

A reader asks, “I have rental property with a mortgage balance of $26000. The property shows a current value of $98900. I would like to refinance but seem to have a problem getting it refinanced? What would you advise me to do in order to utilize my equity to finance another investment.” The scope of this blog is FHA single-family home loans, and we answer questions about FHA loans with that scope in mind. Non-FHA loan related questions that deal with general finance topics may or may not be outside our range of topics. The reader question above may have been submitted under a mistaken assumption that the FHA single family home loan program might include refinance loans (which it does) for investment properties or other non owner-occupied residences (which | more...

April 23, 2015

FHA Loan Mortgage Rate Trends: Flat Overall

By Joe Wallace

Since our last report, mortgage loan rates have been flat overall, with the exception of yesterday’s move which saw rates moving higher. Many market watchers and industry professionals have categorized rate behavior as of late as “flat”, “in a rut” and with yesterday’s shift higher, “breaking free in the wrong direction”. It’s said that after a sustained period with no real movement, a push higher is not unusual. 30-year fixed rate conventional mortgages are hitting, best execution, 3.75% territory depending on the lender. We’ve seen FHA mortgage loan rates break into a new range with 3.375% as the bottom and 3.5% as the high end of this best execution range. That’s up from the previous 3.25% – 3.5% range reported last week. Remember, the term “best execution” refers to rates | more...

Can I buy a manufactured home with an FHA loan?

April 23, 2015

FHA Loan Income Rules: A Reader Question

By Joe Wallace

A reader asks, “Where I can find the income limits on FHA loans, if customer is buying for the first time?” This reader question implies two misconceptions about FHA home loans. The first is that there is a preference, advantage, or other special treatment given to first time FHA loan applicants or first-time home buyers. This is not true insofar as the FHA single-family home loan program itself is concerned. It’s true that there may be state or local programs in the borrower’s zip area that might be available to help first time home buyers. It may also be true that some financial institutions offer first time home buyer programs. But the FHA loan process itself shows no preference, gives no special benefits to a borrower who has never applied | more...

April 22, 2015

FHA Loans For Mixed Use Properties: A Reader Question

By Joe Wallace

Many of our reader questions posted in the comments section here come from loan applicants and home buyers, sometimes even sellers, all wanting to know more about certain aspects of the FHA loan process. But one recent question comes from a lender, who asks: “Customer had bankruptcy chapter 7- discharged 1-2012. Wants to but a home that has a convience store attached to it. Can I do the loan with 5% down and count the income from the store?” FHA loan rules for mixed-use property appraisals address this issue. HUD 4150.2 Chapter Three states: “A qualified property must be predominantly residential in use and appearance. Any nonresidential use of the property must be subordinate to its residential use, character and appearance. A property, any portion of which is designed or | more...

April 1, 2015

New Purchase FHA Mortgage Loans: Some Basics

By Joe Wallace

If you are thinking about applying for an FHA mortgage instead of a conventional home loan, there are aspects of the FHA loan program you should know about before starting the house hunting process that will save you time. Knowing what types of homes you can purchase with an FHA loan, for example, will help you focus your efforts. FHA loan rules published in HUD 4155.2, the Lender’s Guide To The Single Family Mortgage Process, states: “FHA’s single family programs are limited to one- to four-family properties that are owner-occupied principal residences. FHA insures mortgages secured by • detached or semi-detached dwellings • manufactured housing • townhouses or row houses, or • individual units within FHA-approved condominium projects.” The FHA will not approve or guaranty mortgage loans that are secured | more...

June 4, 2014

FHA Loans For More Than One Borrower: A Reader Question

By Joe Wallace

A reader asks, “I would like to know if my mother and i can get a loan together, as i will be getting a divorce and she wants to move from her current residence, so we thought we could split the payments as we would rather not rent.I work full time as an LPN and she is on social security. My age is 54 and she is 76 (very good health).” FHA loans do permit more than one borrower. There are different situations where these borrowers are permitted including those where both applicants would occupy the home together and those where one applicant would be considered a “non-occupying co-borrower”. In the case of this reader question, FHA loan rules require both applicants to qualify for the loan. That means both | more...

February 28, 2014

FHA Loans For Single Parents

By Joe Wallace

There are many FHA home loan options available for qualified borrowers, but one question about the program common enough to warrant attention from the FHA official site itself is whether there is home buying assistance available for single parents looking to purchase a home with an FHA mortgage loan. According to the FHA official site, help for single parents IS available, but one important thing to remember about such homebuyer assistance programs is that they are not administered by the FHA. According to FHA.gov, “There is help available. Start by becoming familiar with the homebuying process and pick a good real estate broker.” The site points out that while single parents won’t have the advantage of two incomes when it’s time to financially qualify for an FHA mortgage, getting pre-qualified | more...

October 10, 2013

FHA Loans For Building on the Borrower’s Own Land

By Joe Wallace

EDITOR’S NOTE: This article was written before changes to FHA loan rules made the old FHA Lender’s Handbook referenced in this article obsolete. The new FHA Single-Family Home Loan Rules are found in HUD 4000.1 and there have been many updates and changes to FHA home loans including One-Time Close Construction mortgage rules. Learn about the most up-to-date information on FHA Construction loans for borrowers who want to build on their own lot. ——- (The information below is no longer up-to-date, but we retain the original article here for archival purposes.) A reader asks, “I am looking to move back home, to where my grandma resides. her home of 45+ years is in disrepair. I filed bankruptcy two years ago, the one where you dont make trustee payments. My question | more...

June 6, 2013

FHA Loan Rules: Contingent Liability

By Joe Wallace

FHA loan rules cover a wide range of circumstances and situations. Many of these rules were written in anticipation of needs that, while not as common as some, still might be in demand many times over the course of a single fiscal year based on the sheer volume of FHA mortgage loan applications. One set of rules governs something known as “contingent liability”, which the FHA loan rulebook describes in HHUD 4155.1 Chapter Four, Section C. “A contingent liability exists when an individual is held responsible for payment of a debt if another party, jointly or severally obligated, defaults on the payment.” This sort of obligation may be known as a co-sign agreement, a co-borrower or co-obligor arrangement. FHA loans require any borrower who has a contingent liability to list | more...