Articles in Category: FHA Loan Types

March 1, 2016

FHA Loan Rules: , Student Loans, Co-Signing and “Contingent Liabilities”

We’ve gotten a variety of questions in the comments section in early 2016 about FHA loan rules for student loans, co-signing, and how the FHA loan program rules view things like deferred obligations and contingent liabilities. Those two terms can be a bit confusing, so it’s good to know what they are and how they can affect your FHA loan application. A deferred obligation is basically any arrangement that resembles a student loan deferment where an amount is owed, but the payment for that obligation may be reduced or delayed as part of an arrangement made between the lender and borrower. In cases where this type of debt is concerned, HUD 4000.1 states that the loan officer must: “…use the actual monthly payment to be paid on a deferred liability, | more...

February 29, 2016

Mortgage Rate Trends: Higher Friday

By Joe Wallace

Mortgage rates moved higher on Friday, pushing closing costs up for some, actual rates up for others. At the end of the day many were still offering a best execution 3.625% for 30-year fixed rate conventional mortgage loans. FHA mortgage loan rates are holding in a range between 3.25% and 3.5% depending on the lender and other factors. FHA mortgage loan rates tend to vary more among participating lenders than conventional rates, so your experience may vary. As always, the rates mentioned here are best execution rates, meaning your FICO scores, loan repayment history and other financial qualifiers will play a big role in your access to rates at or near the ones listed here. Best execution rates are not available to all borrowers or from all lenders. Even though | more...

February 25, 2016

Mortgage Rate Trends: Sideways To Lower

By Joe Wallace

Mortgage loan rates this week to date have been either holding their own (Monday) or moving slightly lower (Tuesday and Wednesday). While market activity did see some lenders raising rates, overall best execution levels are still at 3.625% for 30-year fixed rate conventional mortgages. FHA loans are still within a best execution range between 3.25% and 3.5%, some of the most favorable rates seen in quite some time. “Best execution” refers to rates offered to the most extremely well-qualified borrowers. Your FICO scores, loan repayment history and other financial qualifications will determine your access to these rates. Your experience may vary; the rates you see listed here are not available to all borrowers or from all lenders. Right now, rates are lower because of negative economic factors (among other things)–it | more...

February 19, 2016

Mortgage Rate Trends: Ending The Week With A Move Lower

By Joe Wallace

After three consecutive business days of rates edging higher (hitting 14-day highs at one point), Thursday and Friday saw them moving back down, recovering some of the losses earlier in the week. Some industry pros were anticipating a possible slight move higher today due to bond market activity, but at the end of the trading day that did not pan out. That puts 30-year fixed rate conventional mortgage rates at a best execution 3.625% (depending on the lender), with FHA mortgage rates remaining in a range between 3.25% and 3.5% best execution. FHA rates will vary among participating lenders so your experience may vary. Also, best execution rates as seen here aren’t available to all borrowers or from all lenders. Your FICO score and other financial qualifications play a large | more...

February 18, 2016

Prequalifying For An FHA Home Loan Online

By Joe Wallace

Are you ready to prequalify for an FHA home loan? If you’ve never tried to do so online you’re probably wondering what information you’ll need to provide to get started. There are a number of steps to take, but before you begin it is very important to point out that prequalifying for a mortgage loan is not the same as loan approval. You will need to take additional steps with your loan officer before that can happen, but prequalifying helps borrowers determine what is possible with an FHA mortgage, what the loan amount and payments could be, etc. We’ll use the pre-qualification interface at FHA.com as our reference–it’s located in the center of the page under the heading “Qualify For An FHA Loan”. The first thing you’ll need to do | more...

February 18, 2016

Mortgage Loan Interest Rate Trends: Moving Higher

By Joe Wallace

This week mortgage loan interest rates have been pushing higher but we still see rates at incredible lows. 30-year fixed rate conventional mortgages had fallen to 3.5%, and this week at the time of this writing they had nudged back up to 3.625% best execution. Depending on the lender you may find that best execution rate in a range between 3.625% and 3.75%. FHA best execution rates are currently in a range between 3.25% and 3.5%, depending on the lender. Naturally your experience may vary and best execution rates seen here are not available to all borrowers or from all lenders. Your FICO scores, loan repayment history and other financial qualifications always play a big role in your access to the rates seen here. Industry professionals say the current lows | more...

February 17, 2016

FHA Loan Questions: Can Social Security Income Be Used To Qualify For A Mortgage?

By Joe Wallace

We’ve gotten several questions recently in the comments section about FHA home loans and using Social Security income to qualify. Many of the questions basically ask the same thing–does the FHA permit Social Security income to be used? Can a borrower qualify for an FHA mortgage when Social Security is a major portion of the income? The answer to the question “Do I qualify?” depends on the borrower’s other financial qualifications and an additional factor we’ll explore in a moment. The general answer is that the FHA does NOT view Social Security income as a liability for loan approval, but that income must meet certain standards and requirements. HUD 4000.1 instructs the lender on how to consider Social Security income, which falls under a heading the FHA terms “Disability Benefits”. | more...

February 16, 2016

Electronic Signatures on FHA Loan Documents: FHA Loan Rules In HUD 4000.1

By Joe Wallace

In our last blog post we reviewed the rules in HUD 4000.1 on borrower signatures on FHA mortgage documents. Ever since the publication of HUD 4000.1 late last year we have been examining key passages in the new rule book as there have been many changes, updates, and restatements of FHA mortgage loan policy borrowers and industry professionals alike should be aware of. FHA loan rules for single-family mortgages permit the use of electronic signatures on certain FHA mortgage loan documents provided the signature and procedures used in collecting those signatures meets FHA standards. HUD 4000.1 addresses these requirements, starting with a basic definition of “electronic signature” to avoid confusion: “An Electronic Signature refers to any electronic sound, symbol, or process attached to or logically associated with a contract or | more...

February 16, 2016

FHA Loan Rules In HUD 4000.1: Signatures On Loan Documents

By Joe Wallace

FHA loan rules in HUD 4000.1 spell out a variety of procedures and requirements for the handling of new purchase mortgage loans and refinance loans. One portion of this new (published in late 2015) FHA single family home loan rulebook governs the requirement for borrower signatures on key documents in the FHA loan process. Borrowers must not be asked to sign blank pages or incomplete documents–that’s one of the most basic requirements of the FHA loan procedure. But what are the other rules? Can a borrower use a power-of-attorney for portions of the loan process? What other documents require the borrower’s signature? A section of HUD 4000.1 titled, “Signature Requirements For All Application Forms” states: “All Borrowers must sign and date the initial and final Fannie Mae Form 1003/Freddie Mac | more...

February 15, 2016

FHA Loan Rules For Manufactured Housing

By Joe Wallace

Recently we wrote about HUD’s proposed rule changes for manufactured housing standards to exclude certain recreational vehicles from the same requirements as home manufactured as permanent living spaces. In light of that recent news, it’s a good idea to review FHA home loan rules for manufactured housing, mobile homes, etc. The first requirement for an FHA home loan on a manufactured home/mobile home is that the home must be classified as a single-family dwelling. It must be no less that 400 square feet and must end up being affixed to a permanent foundation. Other requirements include having a HUD Certification Label affixed or the home must have “obtained a letter of label verification issued on behalf of HUD, evidencing the house was constructed on or after June 15, 1976, in | more...