Articles in Category: FHA Loan Types

November 4, 2019

FHA Loan Down Payment Rules

Do you know what the rules are for down payments according to the FHA Lender’s Handbook? HUD 4000.1 states that the minimum required down payment allowed for FHA mortgages is 3.5% of the adjusted value of the home. The borrower must pay this independently of any other closing costs associated with the loan. The seller, lender, or any other party with a stake in the outcome of the transaction cannot provide down payment funds to the borrower. Sellers are permitted to contribute toward closing costs, but not the down payment. The down payment is part of the borrower’s cash requirement to close the loan. The lender is required to verify the sourcing of all down payment funds (including gift funds from other people) to insure the money does not come | more...

October 25, 2019

Important FHA Loan Options For Almost Any Mortgage

By Joe Wallace

There are important FHA loan options you should know about that apply to practically any type of mortgage. No matter if you need a single-unit loan for a typical suburban home or you want to build a house on your own lot using an FHA One-Time Close construction loan, there are options you should consider to get the most mileage out of your loan. FHA Loan Options: Energy Efficient Add-Ons The FHA Energy Efficient Mortgage is an option you can use to add funds for approved energy-saving upgrades to the property. That much is more well-known than the fact that you can use this FHA loan option even if you are applying for an FHA Rehab loan which is already intended to provide funds to repair, renovate, or upgrade a | more...

October 23, 2019

Real Estate, Millennials, And Down Payments

By Joe Wallace

What do millennials and Gen Z’ers say about buying real estate and making down payments? A home ownership-centric website called Porch.com did a survey of roughly 1300 people and the results are quite interesting–and useful to anyone in the planning stages of buying a home. The attitudes of the age groups such as Generation Z and Millennials were of particular interest for this study. “According to our findings” the Porch.com survey page for the Generational Outlook Survey says, “over 75 percent of Gen Zers said it was ‘very important’ or ‘important’ to own a home in their lifetime”, but “only 41 percent” believe it is necessary to do that in the next decade or so. But regardless of when the home is to by purchased, more than 40% of those | more...

October 15, 2019

What Is Ahead For Home Loan Interest Rates?

By Joe Wallace

Last week, mortgage loan interest rates moved higher, reported as a significant increase after hitting lows not seen in some time. At one point in the earliest of October rate changes, mortgage rates went to multi-year lows, taking FHA mortgage loan interest rates below 3.50% for the most well-qualified borrowers. So what is ahead for FHA home loan interest rates? At the time of this writing, FHA rates for a 30-year fixed rate forward mortgage loan (for the most well-qualified applicants) are somewhere at or near 3.375%. Will this low-rate trend last? Is now the right time to buy or refinance a home? The answer depends on plenty of variables including your financial goals for the home–do you plan to stay in it long term or do you know you | more...

October 14, 2019

Happy Columbus Day 2019

By Bruce Reichstein

Today we pause from our posts about FHA home loans, FHA refinance loans, and related topics, to enjoy the three day weekend some observe as Indigenous Peoples’ Day, traditionally observed in the United States as Columbus Day. We’ll return to our usual posting schedule tomorrow (Tuesday October 14, 2019) but in the meantime, if you too are celebrating a three-day weekend, have a safe and pleasant one and thank you for reading!

October 3, 2019

FHA Home Loan Interest Rates Lower

By Bruce Reichstein

There is still time to take full advantage of the higher 2019 FHA home loan guaranty limits set at the start of the new year. If you are thinking about a mortgage or a refinance loan, 2019 may be the year for you. Recent headlines combining a trend in rising home values, more borrowing power, and changes to certain aspects of the home loan industry making it easier in certain sectors (including condo project sales) to buy and sell real estate for residential purposes. Add to that interest rates that are lower after two weeks of improvements at the time of this writing and you have the perfect circumstance for some borrowers interested in lower rates and more borrowing power. What do you need to know about the current FHA | more...

Five FHA Home Loan Questions To Ask Your Lender

September 26, 2019

Rising Equity And FHA Refinance Loans

By Joe Wallace

With reports of rising equity in many housing markets over the last year, it makes sense for those with mortgages to consider an FHA refinance loan. If your financial goals include being able to pull the value of your home out in cash with an FHA refi, there are options to consider alongside the cash out refi loan that could make the difference when deciding which refinance loan is right for your needs. A CoreLogic Homeowner Equity Report reveals that in the last year, home equity in some markets went up nearly five percent since the second quarter of 2018. How much is that increase worth to the home owner? Nearly $5 thousand. Overall, the amount of money homes are worth increased nationwide in the last 12 calendar months to | more...

September 23, 2019

Mortgage Loans, Interest Rates, and Refinance Loans

By Joe Wallace

If you have been following mortgage loan interest rate trends recently, you know that FHA mortgage loan rates have been at historic lows and that last week there was a fairly significant market correction to rates. Fast forward to the end of last week and we see what some finance blogs are describing as a “correction to the correction”; FHA mortgage loan rates (best execution) were reported down from 3.5% to a best execution 3.375%. And for those who already have home loans, the temptation to refinance at the current time to take advantage of mortgage loan interest rates is strong; who wouldn’t want to save more money on their monthly payments or take equity out of the home in cash? Refinancing to make upgrades and improvements to a home | more...

September 13, 2019

Why You Can’t Buy An Airbnb With An FHA Mortgage

By Joe Wallace

Some borrowers read our previous blog posts on what you can and cannot purchase with an FHA home loan and want to know why you can’t buy an Airbnb with an FHA mortgage. FHA loan rules in HUD 4000.1 state clearly that FHA Single-Family Mortgages are intended for primary residences and that any non-residential use of the home must be “subordinate to” the residential nature of the property. HUD 4000.1 also includes instructions to the lender about other acceptable uses of the property including various prohibitions including whether or not you can rent unused portions of your home out to other people after buying it with the FHA loan. For those who are interested in renting to another person as a long-term resident, this is NOT a problem. FHA loan | more...

September 12, 2019

Homes You Can And Cannot Buy With An FHA Mortgage

By Joe Wallace

What kinds of homes can you purchase using an FHA mortgage loan? It does not matter whether you are a first-time home buyer or an experienced borrower, the FHA mortgage option (as well as FHA refinance loan options) are open to any financially-qualified borrower. Homes You Can Buy With An FHA Home Loan: Condominiums The FHA condo loan program was revised in 2019 to include the approval of qualifying individual condo units in projects not on the FHA approved list. That means that it is easier to find a purchase a condo unit with an FHA mortgage. Some believe condos to be closer to the luxury side of real estate buying, but condo units are popular, especially in larger metropolitan areas. The FHA loan program allows borrowers to purchase condo | more...