Articles Tagged With: Fair Housing Act

September 7, 2012

Seller Concessions, The Six Percent Limit, and Inducements to Purchase

In our last blog post we discussed a reader comment about seller concessions. The reader asked a two-part question; “Has the percentage of incentives a seller can offer a buyer with an FHA loan changed yet from 6% to 3%? What if appliances and other things have been requested by the buyer which were covered under a separate sheet not the official home sale offer sheet?” At the time of this writing the FHA limit is still six percent. Some borrowers may be wondering what is meant by “seller concessions”; the FHA loan rule book describes them as contributions of “up to six percent of the lesser of the property

September 6, 2012

Seller Concessions Limit on FHA Loans: A Reader Question

By Joe Wallace

A reader asks, “Has the percentage of incentives a seller can offer a buyer with an FHA loan changed yet from 6% to 3%?

September 5, 2012

What Is the Maximum Loan for an FHA No Cash Out Refinancing Loan?

By Joe Wallace

A common question about FHA refinancing loans has to do with no cash out refinancing loan maximums. What is the maximum loan amount a borrower can apply for with a no-cash out refinancing loan with an appraisal? According to HUD 4155.1 Chapter Three, in the section titled, “Maximum Mortgage Calculation”, the following rules apply: “The maximum

September 5, 2012

FHA Loans and Homeowner’s Association Policies

By Joe Wallace

A recent press release issued by the FHA/HUD announced charges against a Florida homeowner’s association for policies the press release claims are in violation of the Fair Housing Act. According to HUDNo.12-145, “The U.S. Department of Housing and Urban Development (HUD) announced…that it is charging a Gibsonton, FL, homeowners association and its Tampa-based former management company with violating the Fair Housing Act by subjecting a family to different rental terms and conditions because they have six children.” The charges allege, according to the press release, “that Townhomes of Kings LakeHomeowners Association (HOA), Inc., and Vanguard Management Group, Inc., violated the Fair Housing Act by telling the family that they had too many people living in their rental townhouse and threatening to evict them if they didn’t reduce the number of | more...

September 3, 2012

GFI Mortgage Bankers Settles Housing Discrimination Lawsuit

By Joe Wallace

The FHA/HUD official site has issued a press release stating that “GFI Mortgage Bankers Inc., a large independent home mortgage firm that concentrates on the New York, New Jersey, and Florida markets, will pay $3.555 million to resolve a lending discrimination lawsuit filed by the Department of Justice and the U.S. Attorney

August 31, 2012

FHA Loan Reader Question: Am I Eligible For an FHA Loan?

By Joe Wallace

A reader asks, “Me and my husband lost our home due to a house fire. We are currently in a Chapter 13 bankruptcy and have been since January of this year. Is there any way we can buy a new home in this situation? We both have jobs also.” FHA loan rules specifically address the circumstances a borrower who has a Chapter 13 on his or her record can get an FHA home loan. According to HUD 4155.1 Chapter Four Section C; “A Chapter 13 bankruptcy does not disqualify a borrower from obtaining an FHA-insured mortgage, provided that the lender documents that

August 30, 2012

FHA Loan Reader Questions: How Long To Close The Home Loan?

By Joe Wallace

A reader asks, “Once an offer has been made on a home, how long should it take a lender who has prequalified but not preapproved a loan to close on the home?” There are many variables at work with an FHA home loan, so there is no set time period. Many lenders may use a stock answer of between 30 and 45 days, but you should not expect an FHA loan to close within a week to ten days of the mortgage application. It is very important to point out that pre-qualifying for an FHA loan is not the same as having the lender process the loan application data, verify income and employment, and pull your credit reports. That process definitely takes time, which is why the 30-45 day window | more...

August 28, 2012

FHA Loans, Fair Housing Laws, and Discrimination: What You Can Do

By Joe Wallace

In the month of August, 2012, the FHA/HUD official site reported no fewer than four cases investigated by the Department of Housing and Urban Development related to housing discrimination. In one case, the owners of an Alabama mobile home park were charged with discriminating against an African-American family; another case that reached the settlement stage in Alabama involved discrimination against Hispanic residents. Two more cases, one in West Virginia and another in Minnesota, involved racial bias and discrimination due to a medical condition. FHA loan rules, state laws and federal statutes forbid discrimination of any kind in the housing process. Whether you are applying for a home loan, looking for rental housing, or trying to renew leases or refinance, it is illegal to deny housing for reasons of race, creed, | more...

August 27, 2012

FHA Loans and Social Security Income: Important Rule Changes

By Joe Wallace

The Federal Housing Administration has issued new guidance to lenders regarding the use of Social Security Income to qualify for FHA home loans. FHA/HUD Mortgagee Letter 12-15, “Documentation Requirements for Income from the Social Security Administration” lists the new rules for documenting and verifying SSI as income for the purposes of getting an FHA insured mortgage loan. The mortgagee letter states, “The following guidance replaces HUD Handbook 4155.1, 4.D.2.k, in its entirety.” “All income from the Social Security Administration (SSA) including, but not limited to, Supplemental Security Income (SSI), Social Security Disability Insurance (SSDI), and Social Security Income, can be used to qualify the borrower if the income has been verified, and is likely to continue for at least a three year period from the date of mortgage application.” That’s | more...

August 24, 2012

FHA Loans For Disaster Victims: The 203(h) Program

By Joe Wallace

With all the natural disasters in the news lately, plus areas with federal natural disaster declarations in Wisconsin, Maryland, and Montana counties, it seemed like a good time to discuss the FHA 203(h) loan program for disaster victims. The FHA/HUD official site summarizes the FHA 203(h) program as follows; “The Section 203(h) program allows the Federal Housing Administration (FHA) to insure mortgages made by qualified lenders to victims of a major disaster who have lost their homes and are in the process of rebuilding or buying another home.” Not everyone can apply for this particular FHA home loan program. According to FHA.gov, “Individuals are eligible for this program if their homes are located in an area that was designated by the President as a disaster area and if their homes | more...