Articles in Category: FHA Loan Types

July 1, 2016

Mortgage Loan Interest Rate Trends: Slightly Lower

We’ve devoted some extra time to our coverage of mortgage loan interest rate trends this week, due in part to the lows rates have fallen to, and how rates have been affected by Brexit headlines. Ever since the “stay or go” vote in Britain, we’ve seen that issue make a significant impact on many non-Brit markets including our own. Rates plunged to three-year lows or very near to them in the wake of the “leave” win in the Brexit vote. Now, markets have had some time to adjust but there is still plenty of potential for volatility depending on developments overseas and investor reaction to them. That goes for other financial issues too, not just Brexit drama. Indeed, stateside economic data releases could also affect rates in the meantime, though | more...

June 30, 2016

HUD Publishes Early Findings From Home Buyer Literacy Study

By Joe Wallace

Financial literacy is an important part of being a well-informed home buyer. For those just starting out on the journey toward home ownership, there can be a great deal of learning to do; how FICO scores affect your ability to purchase a home, how open lines of credit can and often do factor into a lender’s decision to approve or deny a mortgage, etc. HUD launched a study to see how home buyer education and certain types of financial counseling might make a difference to house hunters. According to a recent press release at the HUD official site, “The U.S. Department of Housing and Urban Development (HUD) today published early findings from a rigorous, large-scale, random assignment study on the benefits that housing education and counseling provides to first-time homebuyers.” | more...

June 30, 2016

Mortgage Rate Trends: Holding At Multi-Year Lows

By Joe Wallace

Mortgage rates are still holding at or near 36-month lows. Brexit drama continues to be a factor in the low rates, but some market watchers believe that we’re about to see the first increase in rates soon, if for no other reason than what’s termed “bond market weakness” that could be an indication things are about to change soon. But there is a three-day weekend ahead, and things tend to get a bit conservative around the holiday. Rates could, based on previous holiday activity, go into “defensive mode”, not changing dramatically one way or the other. On the other hand, we have seen assumptions like that proven wrong due to breaking news, changes in investor behavior, etc. In other words, yes rates are low now, but it’s not safe to | more...

June 28, 2016

Mortgage Rate Trends: Still Moving Lower After Brexit Vote

By Joe Wallace

Mortgage loan rates dropped sharply after the news of the Brexit vote last week, and the fallout from that outcome is still affecting mortgage rates in the short term. The popular vote in Britain to leave the EU is not legally binding-the government there must still make procedural moves to actually depart, and there’s some uncertainty over when or even IF that might happen. Talk of a second referendum is in the news, as well as talk about the “what if” notion of the government in Britain simply doing nothing, not departing the EU in spite of the vote. That, of course, is very much in the realm of speculation at the time of this writing. What does all this mean at home? That investors are still reacting to the | more...

June 27, 2016

Mortgage Rate Trends: Sharply Lower Following Brexit Vote

By Joe Wallace

For five straight business days prior to the Brexit vote, mortgage loan rates moved higher. Investor reaction to the anticipation of the vote played an important part in this; uncertainty over the outcome of the vote and what the vote might do to markets added potential volatility to the daily ups and downs for mortgage loan rates in general. Then the Brexit vote happened, the majority spoke, and investors reacted accordingly. The result? A major shift lower for mortgage rates on Friday, one not seen since well over a year ago. Rates moved lower in one day than they have in all that time, resulting in 30-year fixed rate mortgage best execution rates to fall down 3.5%. FHA mortgage loan rates finally shifted out of their comfort zone during Brexit | more...

June 23, 2016

Mortgage Loan Interest Rate Trends: Moving Higher

By Joe Wallace

Mortgage loan interest rates are moving higher. On Wednesday afternoon it was the fourth straight day of higher movement for rates, and depending on investor reaction to the Brexit referendum in Britain on Thursday we could be in for a continued upward trend. The Brexit referendum naturally does not have any direct effect on mortgage loan rates, but how investors react to this overseas economic news can and likely will push rates in one direction or another. There is also the possibility (however remote) that other breaking news or economic data could take attention away from Brexit drama. It’s something that has happened before, but could it happen with such a major event as the Brexit decision? In any case, there are some industry pros who are convinced that rates | more...

Can I buy a manufactured home with an FHA loan?

June 22, 2016

Are You Ready For An FHA Mortgage?

By Joe Wallace

A recent CNN Money article reveals that more than 10 million Americans spend half their income on rent. It’s a figure (based on a 2014 study at Harvard) that is surprising to some, and motivating for others. Are you considering an FHA mortgage as an alternative to high rents? FHA home loans have features that can be very helpful to those in the market for a new home. Consider the down payment requirement for an FHA mortgage compared to many conventional loans and it’s easy to see that the FHA’s 3.5% down payment requirement compared to between 10% and 20% down for conventional mortgages depending on the lender and the borrower’s financial qualifications. The lower down payment is one factor; another is the borrower’s ability to refinance an FHA mortgage | more...

June 21, 2016

More On FHA Adjustable Rate Mortgages

By Joe Wallace

In a previous blog post we discussed FHA adjustable rate mortgage loans and looked at some aspects of how these loans work. FHA adjustable rate mortgages, also known as ARM loans or FHA ARM loans, feature an introductory rate that the borrower and lender will negotiate. This rate will expire at some point and the new rate will be calculated. The interest rate adjustments over the lifetime of the loan are regulated by an FHA requirement that includes a cap on the amount and severity of the rate changes. As we discussed in the last blog post, there are four components to an ARM loan you should know, which include the following: 1. index 2. margin 3. interest rate cap structure 4. initial interest rate period (also known as a | more...

June 21, 2016

Mortgage Rate Trends: Higher, Faster To Begin The Week

By Joe Wallace

Mortgage rates kicked off the week moving higher and faster than last Friday. The “Brexit” drama in Europe is partly to blame, as investor reaction to the economic uncertainty there influences mortgage rates here. For a while, bond market activity in that regard was favorable to mortgage loan interest rates, but now the wind seems to be shifting directions. The fact that investors don’t know what will happen with the Brexit (will Britain stay in the EU or depart?) and more importantly, don’t know what will happen economically as a result of whatever choice ends up being made is contributing to volatility and potential volatility between now and Brexit referendum time on Thursday. There are some market watchers who are now saying that recent lows are likely as low as | more...

June 20, 2016

What Is An FHA Adjustable Rate Mortgage?

By Joe Wallace

The government’s consumer protection agency, The Consumer Financial Protection Bureau (CFPB), has a page on its official site explaining the differences between a fixed rate mortgage loan and an adjustable rate mortgages, sometimes known as ARM loans. According to the CFPB, “The difference between a fixed rate and an adjustable rate mortgage, is that for fixed rates the interest rate is set when you take out the loan and will not change. With an adjustable rate mortgage, the interest rate may go up or down. With a fixed rate mortgage, the interest rate is set when you take out the loan and will not change”. Does the FHA single-family home loan program offer such a loan? Can borrowers apply for an FHA ARM loan with a participating lender? Yes. Any | more...