Articles in Category: FHA Loan Types

May 25, 2022

FHA Condo Loan Rules For Single Condo Unit Approval

Are you looking for an FHA condo loan with a low down payment? Are you having trouble finding a condo project on the FHA-approved list, even with a lender’s help? There may be options for you thanks to the ability to apply for single condo unit approval from the FHA. At one time, FHA loan rules required condo projects to be on or added to an FHA-approved list before they could be considered for an FHA mortgage. But the rules were updated, and it’s possible today to apply for an FHA condo loan for a unit that’s not part of an approved condo project — that unit may still be eligible for an FHA mortgage. This is accomplished via the FHA Single-Unit Approval process which, according to an FHA Mortgagee | more...

May 19, 2022

Appraisals, Home Inspection, And The Systems Of Your House

By Joe Wallace

We write a great deal about not using the FHA appraisal to determine the condition of the home you want to buy with an FHA mortgage. But why do we say this? Why can’t you trust the appraisal alone? Why pay for the home inspection? There are important reasons for homebuyers to pay for a home inspection as well as the appraisal. Here are some things you should think about before you decide to skip a home inspection. The Foundation of Your Potential New Home Your FHA appraiser is not required to be an expert in areas such as the foundation of the home. Some foundation problems may not be apparent in the appraisal process. They may only be revealed during a home inspection depending on the problem. The appraiser | more...

May 18, 2022

Home Loans And Credit: Facts And Fiction

By Joe Wallace

Are you worried about your ability to pass a credit check for a home loan? Some borrowers may be justified in their concerns, especially after recent pandemic-related financial setbacks or interruptions in employment. Sometimes borrowers are misinformed about their chances of being approved for a mortgage–it’s never a good idea to assume you cannot qualify even if you’re concerned about past credit issues. What do you need to know to move forward? FHA Loan Credit Check Facts: FHA Mortgages Have Lower FICO Score Requirements FHA loan rules in HUD 4000.1 say that applicants with FICO scores of 580 or higher technically qualify for an FHA mortgage. But you’ll need to discuss your scores with a participating lender since lender standards may apply above and beyond the FHA minimum. FHA Loan | more...

May 16, 2022

Why Choose An FHA Mortgage?

By Joe Wallace

Why do some borrowers choose FHA mortgages when conventional loans, VA mortgages, and even USDA home loans are also options to consider? In some cases the answer is easy to understand; the FHA 3.5% down payment minimum is attractive to borrowers who worry they might not be able to qualify for a conventional loan or can’t afford a higher down payment. But FHA mortgages aren’t just for those who want a lower down payment. Some may choose an FHA home loan for their ability to be refinanced later with an FHA Streamline Refinance Loan, which typically must result in a benefit to the borrower such as a lower mortgage rate or lower monthly payments. How do FHA mortgages compare to their non-FHA counterparts? When you compare the FHA loan program | more...

May 12, 2022

FHA Rehab Loans And Remodeling Projects

By Joe Wallace

If you are interested in an FHA 203(k) Rehabilitation Loan to buy and renovate a home or want to use the refinance version of the FHA 203(k) Rehab Loan, there are some things you should know before committing to a renovation project. That’s especially important for those who want to refinance their existing mortgage into an FHA 203(k) and use the loan funds to improve the home they already own. Why? Because it’s easy to get the wrong idea about how much value certain renovations might add to your property. For example, some might believe that adding a pool or hot tub will increase the value of their property. Never mind that FHA 203(k) Rehab loans don’t permit such luxury items, it’s the misconception that’s most important here. Why is | more...

FHA Home Loans And First Time Home Buyers

May 11, 2022

Three Things To Know About FHA Loan Choices

By Joe Wallace

If you have never used an FHA home loan before, there are some things to consider when you’re comparing your options. One of those areas involves your basic needs and goals for the home, and another involves the costs of the loan. A third is related to the choices you have when it’s time to sort out how much to pay upfront and what to consider including in the loan amount. FHA Loans: Fixed Rate Or Adjustable? When interest rates go up, it may be tempting to compare your options between fixed-rate mortgages and adjustable-rate or ARM loans. But don’t look at the rates alone; decide how long you think you may keep the home and make your decision about ARMs afterward. Why? Because if you plan to keep the | more...

May 5, 2022

FHA Home Loan Planning For First-Time Home Buyers

By Bruce Reichstein

If you’re considering an FHA home loan to purchase your first home, there are some issues you might not think about right away when planning and saving for your loan. Anticipating some of these issues can help you make smarter choices about your home, the home loan, and the features of the mortgage. Think Like A Lender That is advice commonly reserved for the credit check, and it’s good advice. Learning to think like a loan officer can help you better determine whether you are truly ready to apply for the loan. For this article, “think like a lender” also extends to things like the type of home you want to buy. What does this mean? When a home is appraised, your lender’s review of the appraisal report will include | more...

May 3, 2022

FHA Loan Income And Employment Rules You Need To Know

By Joe Wallace

Here’s a variation on a common question about FHA loan approval. “I recently switched employment types from salary to commission. How long do I have to earn on a commission basis to qualify for a mortgage?” If you have recently changed the way you earn, that change may complicate your FHA loan process depending on how recently the change happened and other variables. Switching to commission from salary is one of the best-known examples, but some borrowers may have changed from being full-time, in-house employees, to being contractors or consultants. In other cases, an FHA loan applicant may have quit working for someone else to be their own boss as a small business owner. In all cases, the lender requires proof of employment and income in the form of W2s | more...

May 2, 2022

The FHA Energy Efficient Mortgage Program

By Joe Wallace

In April 2022, the Department of Housing and Urban Development announced support for a Washington D.C. program called “Solar For All”, a program HUD says will help, “ensure that residents of HUD-assisted properties in the District are able to access the program without experiencing an increase in their housing costs.” According to a press release on the HUD official site, the “Solar for All” project is intended to bring solar energy to 100 thousand low-to-moderate-income families in the D.C. area. This announcement is part of a Biden administration push to “address climate concerns, and create benefits for residents of HUD-assisted households through equitable deployment of community solar” according to HUD. But did you know that you don’t have to live in Washington D.C. to consider a solar upgrade with an | more...

April 29, 2022

True Or False? FHA Home Loan Issues You Should Know

By Joe Wallace

How much do you really know about the home loan process? If you are interested in buying a home with a low-down-payment FHA mortgage, there are a few things that are good to know before you start house hunting. True Or False? FHA Home Loans Are For First-Time Homebuyers Only False. It’s one of the most common persistent myths about FHA mortgages. True Or False? You Don’t Need A Down Payment With An FHA Home Loan False, but the down payment requirement for FHA mortgages is lower than some conventional equivalents. While it’s true that there are conventional mortgages that offer down payments in the three percent range similar to FHA home loans, you may find the FICO score requirements for these loans to be higher than the FHA minimum | more...