Articles Tagged With: Fair Housing Act

July 11, 2012

FHA Loan Reader Question: Appraisals and “Comparables”

A reader asks, “I am interested in purchasing a log cabin home with 44 acres and I am being told by a lender that FHA requires the comparables must be within a 12 month sale time frame. As you know log cabin homes are not sold that often. Do the comparables have to be within a 12 month time frame like I am being told?” “Comparables” refers to a benchmark FHA appraisers use to help arrive at the fair market value of the appraised property. The appraiser compares the property to be purchased with an FHA home loan to similar homes in the same market to see what current market values might be for those properties. In Issue 30 of the official FHA Appraiser Roster Newsletter, comparables are discussed as | more...

July 10, 2012

FHA Announces Disaster Assistance For Minnesota Storm Victims

By Joe Wallace

The FHA and HUD have announced disaster relief for victims of severe storms and flooding in parts of Minnesota. According to an FHA press release dated July 9, 2012, “Last week, President Obama issued a disaster declaration for Aitkin, Carlton, Cook, Crow Wing, Dakota, Goodhue, Kandiyohi, Lake, Meeker, Pine, Rice, Saint Louis, and Sibley Counties. The declaration also includes Fond du Lac, Grand Portage and Mille Lacs Indian Reservations. The President

July 4, 2012

FHA Appraisal Expiration Dates: Questions and Answers

By Joe Wallace

When buying a home with an FHA guaranteed mortgage loan, one of the most important steps in the process is the appraisal. An FHA appraiser reviews the home to make sure it lives up to minimum property requirements and assigns a fair market value to the property. There are many common questions about FHA appraisals; here are some of them along with the answers. How Long Is An FHA Appraisal Valid? Buyers who purchased property prior to January 1, 2010 may have experienced a different set of standards, but currently, FHA appraisals are considered valid for 120 days. After that time they expire. According to FHA.gov, “Effective for all case numbers assigned on or after January 1, 2010 the validity period for all appraisals on existing, proposed, and under construction | more...

July 4, 2012

FHA Loan Questions: What are the Rules for a Non-Occupying Co-Borrower?

By Joe Wallace

FHA loans require the primary borrower to certify he or she will live on the property, using it as the “primary residence”. But FHA loans allow the option for a non-occupying co-borrower–someone who will be financially obligated on the loan but does not live on the property. FHA loan rules, as spelled out in HUD 4155.1 Chapter Two Section B, say of these types of FHA loan transactions: “When there are two or more borrowers, but one or more will not occupy the property as his/her principal residence, the maximum mortgage is limited to 75% loan-to-value (LTV). However, maximum financing, as described in HUD 4155.1 2.A.2, is available for

July 3, 2012

FHA Loans and Fair Housing Act Enforcement

By Joe Wallace

All lenders, including those who participate in the FHA loan program, are required to comply with Fair Housing Act laws. But in some cases the first line of defense against discrimination is with the borrower who files a complaint after receiving discriminatory treatment in violation of the Fair Housing Act. Fair Housing laws prohibits housing discrimination based on race, color, religion, national origin, sex, disability, or familial status. Borrowers who feel they’ve been discriminated against at any stage of the home buying process should report their complaints as instructed on the FHA official site, which says: “Email or contact us at (800)669-9777 and for the hearing impaired, please call TTY (800)927-9275″. Did you know there is support for such complaints in a variety of languages? Borrowers can find help in | more...

June 26, 2012

FHA Loan Reader Question: Non-Occupying Co-Borrowers

By Joe Wallace

A reader asks, “Hello, I am interested in getting an FHA 203K mortgage to buy a fixer-upper and add repair costs on top of the loan amount. In the conditions of the FHA 203K plan, there is a stipulation that requires the homeowner to occupy the house. Must all of the people listed on the mortgage/loan live in the home? Can just one person listed live there without violating the terms?” FHA loans do make provisions for non-occupying co-borrowers. However, there are limits which apply to these transactions that can affect the amount of the FHA home loan. In most cases an FHA loan with a non-occupying co-borrower has a limit–for qualified borrowers the loan would be approved for 75% of the loan-to-value ratio, rather than the maximum loan amount. | more...

June 21, 2012

FHA Loan Rules For Employment and Income

By Joe Wallace

FHA home loans require the borrower to submit employment information to the lender for verification. This is done for several reasons to include documenting the borrower’s income, stability of that income, and how long that income has been ongoing. FHA Loan rules, as described in HUD 4155.1 Chapter Four, Section D, state the following about income and employment: “To be eligible for a mortgage, FHA does not require a minimum length of time that a borrower must have held a position of employment. However, the lender must verify the borrower

June 20, 2012

FHA Loan Reader Question: Unpaid Debts and FHA Loan Applications

By Joe Wallace

A reader asks, “Can a I obtain an FHA loan with an unpaid charge-off reported on my credit report for over $10,000? I tried to pay/settle the debt, but the bank refuses to accept any payment because the account is in transition. The statute of limits has expired for the the bank to pursue debt collection; however, it has not been seven years for the account to be completely removed from my credit. I

June 15, 2012

Important New HUD Rules For LGBT Home Buyers Seeking FHA Home Loans

By Joe Wallace

There are federal laws in place to prevent housing discrimination on the basis of race, color, creed, national origin, religion, and any number of other factors which have nothing to do with a borrower’s financial qualifications for credit. The Fair Housing Act is one such law, but many other rules apply. No matter if a borrower is applying for a conventional home loan, a VA guaranteed mortgage or an FHA mortgage loan, lenders, brokers, agents, landlords and other parties cannot discriminate in any aspect of the housing process. That said, one important set of protections has been, until recently, missing from the rulebooks for those in need of FHA/HUD services and programs. But in recent times, the Department of Housing and Urban Development has finalized a new set of rules | more...

June 14, 2012

FHA Loan Questions: Can The Lender Include Closing Costs Into My Streamline Refinancing Loan?

By Joe Wallace

A reader asks, “I’m in the beginning process of doing a FHA streamline refi and from the articles I’ve read “FHA doesn’t allow lenders to include closing costs in the new mortgage amount of the streamline refinance.