Articles in Category: FHA Loan Types

April 25, 2017

Mortgage Loan Interest Rate Trends: Higher

Since our last report, we’ve seen rates climbing again, but the most recent uptick in numbers has a lot to do with global political headlines rather than domestic economic issues or market corrections. The election results in France have certain implications-one candidate favors a French version of Brexit and investors watching the results unfold have reacted in ways unfavorable to mortgage loan interest rates. At the time of this writing, we’re seeing upward movement in rates; 30-year fixed rate conventional mortgages are in a best execution range between 4.0 and 4.125%-remember last week we reported some aggressive lenders were offering best execution rates below the four percent line for the first time in a long while. FHA mortgage loan rates are reported at the time of this writing in a | more...

How much can I borrow with an FHA refinance loan?

April 24, 2017

Are You Ready For An FHA Mortgage?

By Joe Wallace

Are you ready to apply for an FHA mortgage in 2017? There are several areas that borrowers should spend plenty of time examining before filling out paperwork or online forms to apply or get pre-approved for a mortgage loan. Credit Reports If you do not know what your lender will see when she pulls your credit report, there’s a good chance you are not ready to fill out FHA loan paperwork. Why? Because if there are errors on your report, questions over certain accounts that may need to be disputed or contested, evidence of identity theft, those will all need to be dealt with before you apply for your loan. A lender can work with a borrower who has disputed accounts still pending (assuming the lender’s standards permit) but if | more...

April 19, 2017

Multiple FHA Loans? The Rules

By Joe Wallace

Based on some of our reader questions lately, there seems to be some confusion over the rules for FHA loans where the borrower is interested in applying for an additional FHA mortgage. What are the rules in HUD 4000.1 on this issue? There are two general areas of confusion related to those rules. Some borrowers have purchased a primary residence with non FHA loans and want to know if the FHA loan rules governing additional mortgages apply to them. According to a literal interpretation of the requirements in HUD 4000.1, borrowers who have a non-FHA mortgage are free to apply for an FHA mortgage without worrying about being in violation of the rules. FHA loans have rules for additional mortgages apply which specifically to those who already have an existing | more...

April 19, 2017

Mortgage Rate Trends: Lower Still

By Joe Wallace

We have devoted more column space to mortgage rate trends than usual this week, due in part because the short-term trend is definitely about moving lower, and we’re finally watching mortgage rate numbers dip into pre-election territory. There is absolutely no way to predict how long this trend will persist, but those who were holding out hope that we might see a move back to pre-November levels are being rewarded this week. Industry professionals and market watchers are quick to point out that this move lower has a lot to do with a combination of overseas economic news and a less-than-enthusiastic reaction from investors from the first 100 days of the new administration where fiscal policy is concerned. The first 100 days ends soon, are there more surprises coming? That | more...

April 18, 2017

FHA Loans And The 100 Mile Rule: A Reader Question

By Bruce Reichstein

A reader asked us a question about FHA loans and “the 100 mile rule”. “I am currently looking to purchase a home with FHA financing 5 miles from my current home in California. The current home I own is secured with a conventional loan. I would like to rent this home out and buy a larger home and finance it FHA because I dont have very much saved up for a larger down payment. Does the 100 mile rule apply to me?” The reader is asking in response to a post we made earlier this year about military FHA borrowers and occupancy rules for FHA loans. This quote from that original post, referencing FHA loan rules in HUD 4000.1, seems to be the issue of most concern for the reader: | more...

When Is An FHA Loan Better Than A Conventional Loan?

April 14, 2017

Identity of Interest Issues And FHA Loans

By Joe Wallace

A reader got in touch to ask about FHA loans and identity of interest rules this week. “I have a loan that I am working on right now and the underwriter is saying that we have an “identity of interest” issue.” “The situation is this my borrower is not related to the seller but has been renting the house she is buying for five months. Because there is no family relationship between the seller & buyer, does she has to live in the house for six months?” The FHA loan rule book, HUD 4000.1, describes identity of interest transactions as a house sale “between parties with an existing Business Relationship or between Family Members.” The word “interest” in this case refers not to interest rates, but rather to the interest | more...

April 13, 2017

Mortgage Rate Trends: Still Moving Lower

By Joe Wallace

Mortgage rate trends this week have been dragging rates to their lowest levels of the year. Around election time last year, we began to see the stage being set for some upward trending that pushed mortgage loan interest rates out of their three percent ranges and back into four percent territory. At one point it seemed likely that the mid-fours could be the range for the new year. But now, at least in the short term, we are seeing rates creep back down, closer to where they were pre-election (assuming the downward trend persists). There are several reasons for this, including bond market activity, geopolitics, and most recently a reaction to statements from the White House that the dollar is performing too robustly (paraphrasing ours). To learn more about what | more...

April 12, 2017

Mortgage Loan Interest Rate Trends: New Lows

By Joe Wallace

In our last report, we noted that mortgage loan interest rates had been on the move, losing a small amount of ground over the previous two business days. We also noted that it was too early to tell if that was becoming a trend, or if the move higher was a short-term fluctuation. At the time of this writing, mortgage rates have since plunged to lows we haven’t seen for a majority of the year. There are complex reasons why rates have suddenly moved downward. Global political headlines often play a role in the direction of mortgage rate movement, especially when those headlines have far-reaching implications. This week we’ve seen French elections, Russia and North Korea dominate headlines in ways that have investors moving their cash into safer bets, which | more...

April 11, 2017

Maximum Loan Amounts For FHA Loans

By Joe Wallace

What are the FHA loan rules for maximum loan amounts? The rules for loan amounts are found in the FHA single family home loan rule book, HUD 4000.1 has answers, starting with this from page 155: “A Mortgage that is to be insured by FHA cannot exceed the Nationwide Mortgage Limits, the nationwide area mortgage limit, or the maximum Loan-to-Value (LTV) ratio. The maximum LTV ratios vary depending upon the type of Borrower, type of transaction (purchase or refinance), program type, and stage of construction.” Borrowers sometimes wonder if they can apply for a home loan for more than the purchase price of the home. The answer to such questions depends greatly on what the extra money is to be used for. For forward mortgages and refinance loans alike, FHA | more...

April 11, 2017

Mortgage Loan Interest Rate Trends: Higher

By Joe Wallace

Since our last report, mortgage loan interest rates have risen slightly but overall remain within the same range as we’ve been reporting on now for several weeks. Both Friday and Monday saw rates moving higher in spite of conditions that have in the past contributed to helping rates move lower. This is not unusual, but it happens infrequently enough to raise eyebrows among those who aren’t used to watching these ups and downs. The contrarian moves in rates as of late gives market watchers reason to be lukewarm on “floating” or holding off on a mortgage loan interest rate lock with a lender in hopes that rates may go lower before the lock agreement is finally made. The moves higher aren’t enough to create the impression that we’re headed into | more...