Articles Tagged With: FHA and HUD

December 18, 2017

FHA Announces Reverse Mortgage Loan Limits For 2018

The FHA has announced reverse mortgage loan limits for 2018. The agency recently posted the forward mortgage loan limits for 2018, and the update for FHA reverse mortgages comes as no surprise given the overall increases posted for next year’s loan limits by county for new purchase loans. The FHA reverse mortgage is also known as the Home Equity Conversion Mortgage, or HECM for short. According to the FHA official site, the maximum “claim amount limits for Traditional HECM, HECM for Purchase, and HECM-to-HECM refinances are governed by the maximum claim amount limitation” are found in sections 25 5(g) and 255(m) of the National Housing Act. “FHA publishes updated limits effective for each calendar year” according to the most recent mortgagee letter at FHA.gov. The new limits are, according FHA | more...

December 15, 2017

HUD Announces Settlement In California Fair Housing Case

By Joe Wallace

The Department of Housing and Urban Development has announced a settlement in a California Fair Housing Act case. According to a press release on the HUD official site, HUD has entered into an agreement “with the owner and property manager of Shadowbrook Gardens Senior Townhomes in Morgan Hill, California, a city in Santa Clara County, resolving allegations that they discriminated against a resident with disabilities”. A tenant of that property, “requested to have a live-in aide and a key to a locked gate near her unit that would make it easier for her to come and go” according to the HUD press release, which adds that in each case, “the owner and property manager allegedly asked her intrusive questions about her disability, challenged whether she really had a disability, asserted | more...

December 8, 2017

FHA Revises Policy On PACE Assesments

By Joe Wallace

The FHA has revised its’ policy on home loans for properties encumbered by Property Assessed Clean Energy (PACE) obligations. According to the FHA official site, in 2016 the agency “established requirements regarding the eligibility for FHA-insured mortgages of properties encumbered with PACE obligations that permitted, under some circumstances, a continuing obligation for repayment of the PACE obligation even after foreclosure and acquisition by FHA.” But that policy has since come under review due to concerns “for increased losses to the Mutual Mortgage Insurance Fund due to the priority lien status given to such assessments in the case of default.” According to the official site, the agency “is also concerned with the lack of consumer protections associated with the origination of the PACE assessment, which are far less comprehensive than that | more...

November 30, 2017

HUD Announces Hurricane Irma Aid Package For Hardest-Hit Florida Communities

By Joe Wallace

HUD has announced a multi-milllion dollar Hurricane Irma aid package for hardest-Hit Florida communities. A press release at the Department of Housing and Urban Development details the federal aid, intended for areas HUD deems the most affected. According to HUDNo.17-106, the aid package include $615,922,000 made available via the HUD Community Development Block Grant–Disaster Recovery (CDBG-DR) Program. “The entire federal family” stands with the people of Florida “to help them recover from this devastating storm as quickly as possible,” according to HUD Secretary Ben Carson, who is quoted in the press release, adding, “HUD and the State of Florida will work together to speed the rebuilding of seriously damaged homes and businesses that lack the resources to recover on their own if not for these recovery dollars.” In September, the | more...

Credit Scores For An FHA Home Loan: When Low Credit Is Not Bad Credit

November 28, 2017

What Are the FHA Loan Requirements For Sewer/Septic Systems?

By Joe Wallace

What are the FHA requirements for sewer/septic systems? Some borrowers want to know if the property they’re interested in purchasing with an FHA mortgage loan will qualify if there is a septic tank on the property. Others want to know specific required distances from a septic tank to the property line or related requirements. For example, a septic tank, under FHA appraisal rules, must be at least 50 feet from a well, where applicable. FHA loan rules in HUD 4000.1 require a property to meet minimum appraisal requirements before a loan will be approved. Some issues cannot be fixed, but other situations may be repaired or corrected. When a property can be modified, repaired or improved to meet those standards, FHA rules allow the loan to happen with the corrections | more...

November 27, 2017

FHA Loan Rules: Using Rental Income to Qualify for a Mortgage Loan

By Bruce Reichstein

What do FHA loan rules say about using rental income to qualify for an FHA home loan? Is it possible to use rental income according to the FHA loan handbook, HUD 4000.1? The short answer is that it depends on whether or not the rental income meets FHA loan minimum standards. When processing your home loan application, your participating FHA lender will request copies (never originals) of the relevant paperwork associated with your employment and income, including tax documents, W2 forms, pay stubs, etc. If your income is derived in whole or in part by rent payments, the lender will need to see documentation for that, too. FHA loan rules in HUD 4000.1 address this on page 202, starting with the definition of what is considered rental income under the | more...

Time Is Running Out On Exterior-Only FHA Appraisals

November 23, 2017

Happy Thanksgiving!

By Joe Wallace

Happy Thanksgiving! Today we pause from our usual discussion of FHA home loans, refinance loans, FHA reverse mortgages and related topics to enjoy the holiday. Our regular schedule of posts resumes on Friday. Have a safe and fun Thanksgiving holiday and we’ll see you tomorrow!

November 20, 2017

What Do I Need To Qualify For An FHA 203(h) Rehab Loan For Disaster Victims?

By Bruce Reichstein

What do I need to qualify for an FHA 203(h) rehab loan for disaster victims? Those in the hardest-hit areas may require complete replacement of a home damaged or destroyed by Hurricane Harvey, Hurricane Irma, Hurricane Maria, or California fires. But what are the basic requirements of the FHA 203(h) rehab loan? FHA 203(h) Rehab Loans Are For Those In Federally Declared Disaster Areas The basic requirement for an FHA 203(h) rehab loan is that the applicant’s property is located in a federally declared disaster area. According to HUD 40001., “The previous residence (owned or rented) must have been located in a (federally declared disaster area) and destroyed or damaged to such an extent that reconstruction or replacement is necessary. A list of the specified affected counties and cities and | more...

November 13, 2017

Does FHA Have A Disaster Loan Program?

By Bruce Reichstein

Does FHA have a disaster loan program? The short answer is yes, and it is quite different than a standard FHA forward mortgage. The FHA 203(h) loan is available as a new purchase mortgage or a refinance loan. In this case “new purchase” may lead some to believe you are only allowed to buy a new home with an FHA 203(h), but the reality is that you can use the 203(h) to rehab an existing damaged home, or purchase a replacement home. FHA 203(h) Disaster Loans: Unique Requirements FHA 203(h) disaster loans are only approved for those who are in federally-declared disaster areas. You cannot be approved for an FHA 203K(h) mortgage if you are not in a one of the official presidentially-declared federal disaster areas. You can check the | more...

November 9, 2017

HUD Makes Disaster Relief Available For California Wildfire Victims

By Joe Wallace

The Department of Housing and Urban Development has announced disaster relief for victims of California wildfires, following a presidential declaration of federal disaster areas in the state. According to a press release published on the HUD/FHA official site, “HUD will speed federal disaster assistance to the State of California and provide support to homeowners and low-income renters forced from their homes due to wildfires” in the counties affected by the major disaster declaration. Those counties include: Butte Lake Mendocino Napa Nevada Orange Sonoma Yuba Those in federally declared disaster areas are eligible for a variety of measures from the FHA and HUD including FHA loan foreclosure relief in the form of a 90-day moratorium for all FHA mortgage foreclosure actions in the affected areas. Home owners may also be eligible | more...