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Articles in Category: Fixed Rate Mortgage

March 8, 2013

FHA Loan Answers About Down Payments

By Joe Wallace

We get reader questions about FHA loan down payments–many people aren’t sure how much they need to pay up front and how much is required by the FHA loan program. Some borrowers mistakenly assume there’s a “no money down” option for first-time FHA loan applicants, and others assume there is a set dollar amount which must be paid regardless of the transaction. What’s the reality? FHA home loans do not feature a no-money-down option. FHA loan rules state that the minimum required down payment is as follows: “For purchase transactions, the maximum LTV is 96.5% percent (the reciprocal of the 3.5% required investment).” The acronym “LTV” stands for loan-to-value and is, in simple terms, the amount of the loan after the down payment has been made. An LTV of 96.5% | more...

 

March 1, 2013

FHA Loan Reader Questions: First Time Homebuyer Requirement?

By Joe Wallace

A reader asks, “I’m not a first time home buyer, I have a conventional loan for a home that I’m planning to keep as a rental home. Can I qualify for a purchase FHA loan on a primary home?” One of the common misconceptions about FHA home loans is that you MUST be a first-time home buyer in order to qualify for one. This is not true. You may have state or local homebuyer assistance programs in your area that do require the applicant for that program to be a first time buyer, but FHA loans are open to all qualified applicants. The real issue in this reader question has more to do with debt-to-income ratios (DTIs)–will the FHA lender approve a buyer who already owns a home? Single-family new | more...

 

March 1, 2013

Sound Advice From the FHA on Buying A Home With an FHA Mortgage

By Joe Wallace

If you’re thinking about buying a home with an FHA guaranteed mortgage, now is a very good time to explore your options. Mortgage loan rates may have risen slightly from their “all-time lows” of the past 12 months, rates are still very good, and the housing market recovery makes purchasing a home more attractive than ever. What kind of advice does the FHA official site offer to house hunters thinking about that first FHA home loan application? There first thing to ask is whether you are ready to commit to buying a home now, or if you need to take some additional preparation time. How do you know if you’re ready to commit? According to the FHA, “You can find out by asking yourself some questions: – Do I have | more...

 

June 23, 2011

What is the FHA 203(b) Loan Program?

By Joe Wallace

If you’re new to FHA home loans, it’s easy to get confused by the different types of FHA insured mortgages available. There are FHA 203(b) loans, the FHA 203(k) and a host of others. Some borrowers are ready, after seeing the alphabet soup of different programs a borrower could apply for, to throw up their hands and just ask for “the FHA loan everybody applies for when they want a new home.” That loan is known as the FHA 203(b), the single-family mortgage insurance program most commonly used all over America. According to the FHA official site, the FHA 203(b) “may be used to purchase or refinance a new or existing one-to-four family home in both urban and rural areas including manufactured homes on permanent foundations. Typically, lenders offer terms | more...

 

February 28, 2011

Where Do I Go for an FHA Insured Home Loan?

By Joe Wallace

First time home buyers often don't know where to start when it comes time to find that first home. Locating properties for sale isn't challenging--there are plenty of for sale signs in or near practically every neighborhood and even more to browse in the local papers and online real estate listings. But finding the home is only part of the challenge. Where does a buyer find a suitable lender? A buyer who wants an FHA home loan might not know where to start looking to find a lender. Conventional borrowers have it easier--any suitable bank with the right terms will do.

 

February 21, 2011

How to Shop For an FHA Home Loan

By Joe Wallace

Applying for an FHA loan is, in the minds of some borrowers, the beginning of the process. But when you fill out an application for an FHA insured mortgage, you should actually be ending one process and starting another. One of the most important aspects of getting an FHA loan is finding the right lender and the most favorable terms. But how should an FHA borrower do that? Some go into their FHA loan research thinking the only real data needed is a list of interest rates on offer and calculating the monthly payment amounts is enough.

 

February 11, 2011

FHA Loan Costs and Interest Rates

By Joe Wallace

When you're shopping around for a lender for an FHA home loan, it's good to remember that buying a home involves costs above and beyond the asking price of the home; some of these costs can be estimated by the lender to give you a rough idea of how much you should budget for when planning your finances for a new FHA mortgage. The basic costs of buying real estate include the interest rate--how much will your loan cost over its lifetime? It's easy to dismiss a percentage point up or down until you do the math--one percentage point lower could save you thousands over the life of a 30-year FHA mortgage. That's one reason why discount points are important--paying more up front can save you money later down the | more...

 

February 9, 2011

Using the FHA Lender List

By Joe Wallace

For first-time home buyers, the FHA loan process seems complicated. The loan application itself requires a great deal of information including credit and employment history, a record of your previous residences, and a list of your verifiable income. Any home loan application requires this level of detail in order to process the loan correctly, but for some borrowers just getting to that point can be challenge. What does a buyer do when they don't know who to submit a loan application to?

 

February 8, 2011

FHA Loans: Factors that Affect House Prices

By Joe Wallace

When it's time to start thinking about buying a home with an FHA mortgage, first-time home buyers often need to learn a few things about the nature of the housing market. One of the most important lessons a new house hunter learns is that not all properties are created equal, and even those that do seem similar have unique issues that may affect the price and availability of the property. The housing market is an ever-changing thing. Whether you apply for a conventional or FHA insured mortgage loan, much depends on the place where you're conducting the search for a suitable home.