Articles in Category: FHA Loan Types

March 14, 2017

Mortgage Loan Interest Rates Surging Higher Ahead of Fed

Since our last report, mortgage rates have pushed significantly higher. Industry professionals are watching the Fed very carefully at the moment as it’s expected that the Fed will hike interest rates soon. Any indication of that hike, the timing of the hike, or its’ severity is sure to send investors scrambling in one direction or the other. A hike in rates is a sign that the Fed has more confidence in the economy, but as we’ve mentioned here before, what is good for the economy is often bad news for mortgage loan interest rates. We are likely to see markets react in anticipation or out of a certain set of expectations rather than the actual reality of the situation. This sort of thing has happened before, when the Fed began | more...

March 10, 2017

FHA Appraisals: A Reader Question

By Joe Wallace

This week in our comments section, a reader asked us a question about how certain aspects of FHA appraisals work. “I am pre-approved for a FHA loan, and lucked into having an estate offered to me before they list with a realtor, at a fantastic price! Problem is, it is 6 acres with an older mobile home…it was built in 1977, so meets the age requirement barely, but I have heard many different explanations as to what qualifies it as ‘permanent’, or ‘tied to the land’.” “It cannot be moved, has had permanent additions on foundations attached, and a complete roof addition over all of it, so certainly cannot be moved, and is in REALLY great condition. However, the title has NOT been retired for itso my question is, can | more...

March 9, 2017

FHA Mortgage Questions And Answers

By Joe Wallace

There are many questions about FHA loans-those who are new to the process want to know some very basic, but very important things including how down payments are calculated, who is eligible for an FHA loan, and whether the borrower is free to sell the home purchased with an FHA mortgage after buying it, and how soon. Let’s explore some of these questions: Am I Eligible For An FHA Loan? The implication with a question like this sometimes includes another question. “Do I make too much money to qualify?” This is due to a misconception that FHA mortgages are intended only for first-time buyers, the economically disadvantaged, or those who have earnings that fall within a certain range. But the truth is, FHA mortgage loans have no income limits and | more...

March 9, 2017

Mortgage Rates Sharply Higher

By Joe Wallace

This week we’ve devoted a bit more column space to mortgage rate trends, and for good reason. Markets hate uncertainty, investors tend to move to “safe haven” investments in times like these, and we’re seeing plenty of activity in markets that affect mortgage loan rates in this area. Add to that economic data releases which, though spelling out good things for the country, put upward pressure on mortgage rates. That adds up to significant short term activity. And the latest has both conventional mortgage loan interest rates and FHA mortgage rates moving into new, higher ranges. 30-year fixed rate conventional mortgages are reported, at the time of this writing, in a new best-execution range between 4.25% and 4.375%, a sharp turn upward some professional market watchers are labeling the highest, | more...

March 8, 2017

Qualifying For An FHA Mortgage

By Joe Wallace

Why don’t some borrowers qualify for an FHA mortgage loan? A reader got in touch with us recently to ask a question along these lines: “I work at a high school, married w/baby. My credit is 640 have the 3.5% but my real estate lady says I dont qualify, FHA whats up?” Just a note for clarity: this blog is in no way affiliated with the FHA, HUD or any government agency. We report on FHA loan rules, news, and policy, but we have no connection with the agency itself. This reader question is a good example of a type of misunderstanding of the FHA loan approval process-that FICO scores alone determine your ability to get an FHA mortgage loan application approved. FICO scores are very important, and people can | more...

March 8, 2017

Mortgage Rate Trends: Edging Higher

By Joe Wallace

Since our last report, mortgage rates had one day of mild recovery, but yesterday rates took an upward turn. Many industry professionals are keen on next week’s Fed meeting as a potential make-or-break in terms of short-term rate trends. Will the Fed hike interest rates? What will the investor reaction to that news be if it comes to pass? These are the questions on the minds of those watching mortgage loan interest rate trends at the moment. And until next Wednesday, all anyone can do is wait and watch. At the time of this writing, 30-year fixed rate conventional mortgages are reported at a best-execution 4.25%, borrowers have likely noticed recent rate changes reflected in closing costs rather than an actual rate change. FHA mortgages are holding in their range | more...

March 6, 2017

Mortgage Rate Trends: Higher

By Joe Wallace

Mortgage loan rates have been rising in small increments for the last five business days-Friday’s move upward was small but is still part of that overall upward trends. The Fed is likely to announce an interest rate hike at their meeting on the 15th, which won’t help the mortgage rate environment, but by the time that hike is announced rates are likely to already reflect any negative consequences (on mortgage rates). What is good news for the economy is often bad news for mortgage loan interest rates. The Fed raising rates is an indicator that the economy is stronger, and investor reaction to that climate can and often does have a negative effect on mortgage rates. At the time of this writing, 30-year fixed rate conventional mortgages are reported at | more...

March 1, 2017

Mortgage Rate Trends: Slightly Higher

By Joe Wallace

We’ve seen three days of improvement, followed by two days of mortgage rates creeping upward. The rate environment at the time of this writing is a bit contrary-we have seen stronger economic news and data this week that traditionally has put upward pressure on interest rates. But the most recent stronger data hasn’t put as much pressure on mortgage rates and for that we can report that number-wise, the best execution rates haven’t budged that much. Affected borrowers will likely see the difference reflected in closing costs. 30-year fixed rate conventional mortgages are holding at a best execution 4.125% at the time of this writing, which is an adjustment from the earlier range between 4.125% and 4.25% best execution. FHA mortgage rates are holding in a range between 3.75% and | more...

February 27, 2017

Types of Homes Eligible For FHA Mortgages

By Bruce Reichstein

What kinds of property types can be purchased with an FHA mortgage loan? It’s a simple question, but there are some occasional misconceptions about FHA requirements for single family homes that borrowers should know about as they plan their mortgage. There are rules on eligible property types that can be purchased with an FHA mortgage loan. These rules are found in HUD 4000.1, and include the following guidance to the participating FHA lender: “FHAs programs differ from one another primarily in terms of what types of Properties and financing are eligible. Except as otherwise stated in this SF Handbook, FHAs Single Family programs are limited to one- to four-family Properties that are owner-occupied Principal Residences.” The phrase, “owner-occupied principal residences” is an important one-FHA mortgage loan rules include an occupancy | more...

February 27, 2017

Mortgage Rate Trends: Third Day Lower

By Joe Wallace

Mortgage rates fell for the third day in a row on Friday, though affected borrowers may have noticed the changes reflected in closing costs rather than an actual interest rate change. We’ve seen rates drop low enough that some market watchers are using phrases like “back to 2017 lows” and “lowest levels of the year”. The mortgage rate trends we’ve seen as of late are within a narrow range, and it’s not clear whether that range will adjust in the short term. In 2017 we’ve seen rates break into the four percent range, even FHA mortgage rates are now moving within that range at the upper end of their current “comfort zone”. At the time of this writing, 30-year fixed rate conventional mortgages are in a best execution range between | more...