Articles Tagged With: FHA 203k Mortgage

May 7, 2018

FHA 203(k) Rehab Loans: What’s A Contingency Reserve?

If you are interested in buying or refinancing a home to renovate with an FHA mortgage, the FHA 203(k) loan is a great place to start exploring your options. The FHA 203(k) rehab loan comes in two varieties-one for larger and more ambitious projects, and a smaller “limited” 203(k) that offers smaller loans for simpler repairs/renovations. The 203(k) loan involves hiring contractors and having work done according to both FHA home loan minimum standards, but also requires that the home be brought into compliance with applicable building codes. Lender standards, state law, and FHA home loan rules will affect how this transaction is conducted. One FHA requirement is the FHA rehab loan contingency reserve, which you can think of as a “rainy day fund” in case there are unexpected costs | more...

If Your Home Was Damaged In A Federally Declared Disaster Area

April 30, 2018

FHA Loans That Allow Home Improvements, Renovations, and One-Time Close Construction

By Bruce Reichstein

In addition to new purchase home loans and refinance loans, a borrower’s options for a mortgage also include loans that allow money for home improvements, renovations, and even construction. Know your FHA loan options before you choose a type of property or the kind of loan you seek. There are many ways to get additional funds to fix, rehab, or even build a home from the ground up. FHA New Purchase Home Loans There is an option with most FHA mortgages including new purchase loans that allows added funds for the purpose of buying and installing energy-efficient upgrades to the home. No matter what type of FHA mortgage you want, ask the lender about the FHA Energy Efficient Mortgage option which allows up to $6,000 or more depending on the | more...

April 23, 2018

FHA Home Loan Options: Build, Buy, Or Rehab

By Joe Wallace

Build, buy, or rehab? Those are among the options open to FHA home loan applicants. Do you know what is possible with an FHA mortgage loan? The options range from purchasing an existing 1-4 unit home to having a single-family house built from scratch using an FHA One Time Close construction loan. FHA Home Loans: The “Forward Mortgage” “Forward mortgage” is a fancy way of describing the new purchase loan-an FHA mortgage that will help you buy a home. “Forward mortgages” are described as such to distinguish them from Home Equity Conversion Mortgages (HECM) or as they often called, Reverse Mortgages. A forward mortgage can include purchase of land and funds for a construction phase when an FHA One Time Close loan is being used to build to suit. FHA | more...

March 20, 2018

Property Flipping And FHA Home Loan Rules

By Joe Wallace

What do you need to know about property flipping and FHA home loan rules? The first thing to know is that flipping is addressed in the FHA loan handbook, HUD 4000.1 and there are measures in place to discourage the practice. That said, the rules which prevent flipping usually apply to the buyer’s side of the transaction. FHA loan rules don’t forbid a borrower from selling the home purchased with an FHA mortgage at any time. But the rules do have something to say about FHA mortgage approval for “flipped” homes. How FHA Defines Flipping Not all homes that are purchased and end up back in the housing market fairly quickly will meet the FHA definition of a flipped house. HUD 4000.1 defines flipping on page 145, stating: “Property Flipping | more...

March 15, 2018

HUD Announces Additional Hurricane Recovery Efforts In Houston

By Bruce Reichstein

The Department of Housing and Urban Development has announced a Fair Housing agreement with the City Of Houston designed to enhance hurricane recovery efforts there. According to a press release at the FHA/HUD official site, HUD and the city reached, “a joint agreement designed to expand housing choice and mobility for lower income residents, including those experiencing homelessness and victims of Hurricane Harvey.” The agreement includes a new requirement for the City of Houston to adopt “multifamily priorities and a policy for objectively evaluating federally supported affordable housing developments in all areas of Houston; to seek to invest additional funds in homeless assistance programs, and; to encourage more landlord participation in Houston’s housing voucher program”. “Today, we announce a positive agreement that works to expand housing options for lower income | more...

FHA Mortgage Loans: Do Interest Rates Matter?

March 13, 2018

When Should I Refinance With An FHA Mortgage?

By Joe Wallace

When should I refinance with an FHA mortgage? That is a question many home owners face, especially if their financial plans have changed from the ones the borrower had when closing the original mortgage. Do you know if it is a good time to refinance? If you need lower payments or interest rates, and are credit-qualified to receive those lower rates, it may be the right time to explore your options. FHA Refinancing For Borrowers In Adjustable Rate Mortgages Some FHA borrowers buy a home with an adjustable rate loan, either thinking they will sell before the introductory rate ends (or before the rates are adjusted beyond a certain threshold) or refinance the loan at some later date. FHA ARM loan adjustments may be more conservative than some conventional loan | more...

Coronavirus And Home Loan Appraisals: What You Need To Know Now

March 7, 2018

Help For Spanish-Speaking HomeOwners In Federal Disaster Areas

By Joe Wallace

Homeowners in federally-declared disaster areas are still working to recover homes, property, and personal lives after the hurricanes, mudslides, fires, and other natural disasters in recent times. Efforts by the federal government including the FHA and FEMA are ongoing. Home owners-including FHA borrowers-have a range of options open to them including FHA loan foreclosure avoidance, loan forbearance, even the addition of a partial claim procedure to help FHA borrowers avoid payment shock as they resume pre-disaster FHA home loan payments. Some of these programs are well-known in the disaster areas they serve. But what might not be so well known? The fact that information about these programs is available in Spanish. The FHA/HUD official site includes information in Spanish about disaster relief options. The publication, “Información Importante Sobre Recuperación Ante | more...

February 16, 2018

FHA 203(k) Rehab Mortgages: Who Does The Rehab Work?

By Joe Wallace

When it comes to FHA 203(k) rehab loans, many borrowers want to know who does the work? Can the borrower hire a contractor, is the borrower required to do the work themselves? What are the rules? The guidelines for the FHA 203(k) rehab loan program are found in HUD 4000.1, which states that certain standards are in place when trying to select the contractors to do the labor. For starters, this type of loan requires that the borrower use the services of a 203(k) loan consultant. “The Mortgagee must select an FHA-approved 203(k) Consultant from the FHA 203(k) Consultant Roster in FHAC. The Mortgagee must not use the services of a Consultant who has demonstrated previous poor performance based on reviews performed by the Mortgagee. The Consultant must inspect the | more...

January 25, 2018

FHA Loan Options For Buying A Home

By Joe Wallace

FHA loan options for buying a home include choices on the housing type you need, the type of home loan you need, and sometimes even the circumstances of the purchase, in the case of people who are buying homes in federally declared disaster areas. Do you know what your new purchase FHA home loan options are? FHA Loans Available For Many Types Of Homes FHA home loans can be used to purchase property that will be owner-occupied residences, but the home can have as many as four living units. That means the borrower has the option to rent out unused living units if she chooses. Owner occupancy is a condition of loan approval, so you can’t use an FHA loan to purchase an investment property (one you intend to rent | more...

January 19, 2018

How To Use An FHA Home Loan

By Bruce Reichstein

Do you need to know how to use an FHA home loan? There are many things you can do with an FHA mortgage, or an FHA refinance loan. Some of your options include buying a home with more than one living unit, refinancing an existing loan to do rehab or repair work, and including energy-efficient upgrades into your new mortgage. Use An FHA Home Loan To Buy Your First Home FHA home loans are not specifically targeted at one type of buyer, but first time home buyers enjoy the lower down payment requirements and more lenient FHA credit requirements. First time home buyers may learn early that the FHA home loan program isn’t strictly for first homes, but that the participating lender has some kind of first-time buyer incentive. This | more...