Articles Tagged With: FHA and HUD

February 2, 2022

HUD Announces More Funding For Areas Hit By Natural Disasters

The Department of Housing and Urban Development has been very busy in 2021 and 2022 responding to natural disasters and announcing the latest federal disaster assistance in areas hardest hit by storms, fires, flooding, and more. Homeowners in federally-declared disaster areas soon learn about the FHA’s foreclosure moratoriums and options for recovering damaged or destroyed homes using FHA 203(h) and FHA 203(k) Rehabilitation Loans (amongst multiple options). Now, HUD has announced further assistance for current and future disaster areas in the form of “Allocations for Community Development Block Grant Disaster Recovery” plus the start of something called CDBG-DR Consolidated Waivers and Alternative Requirements Notice.” That notice is described by the HUD press release as being “ a critical step taken by the department to open access to more than $2 | more...

January 14, 2022

Advantages Of An FHA Cash-Out Refinance Loan

By Bruce Reichstein

Do you know the advantages of an FHA cash-out refinance loan? There are several, especially if you are considering an FHA loan to get money to renovate your existing home. FHA Cash-Out Refinancing Loans: Good For FHA and Non-FHA Mortgages FHA cash-out loans are for all mortgages, FHA, or not. You can refinance a USDA, VA, conventional, existing FHA loan, etc. The rules to qualify are the same no matter what kind of home loan you wish to refinance, and the longer you have been making mortgage payments, the better. FHA Cash-Out Refinance Loan Funds Are Not Restricted The uses you put your cash-out refinance money towards is not restricted; you can use your cash-out funds any way you see fit. That includes debt consolidation, vacations, and home repair. FHA Cash-Out | more...

December 14, 2021

HUD Announces Disaster Relief For Kentucky Home Owners In Federal Disaster Areas

By Joe Wallace

The FHA and HUD have announced disaster relief for FHA borrowers who live in the federally declared disaster areas in the State of Kentucky. The declaration was made effective as of December 10, 2021, in the wake of flooding, tornadoes, and other natural disaster-related issues. The President announced major disaster declarations for the following counties in Kentucky: Caldwell Fulton Graves Hopkins Marshall Muhlenberg Taylor Warren An FHA/HUD press release published at HUD.gov adds that there is also relief on a “cost-sharing basis” in Caldwell, Fulton, Graves, Hopkins, Marshall, Muhlenberg, Taylor, and Warren counties. What does the FHA/HUD disaster relief announcement mean for FHA borrowers and homeowners? HUD offers “immediate foreclosure relief” for FHA mortgages in the form of a 90-day moratorium “on foreclosures of Federal Housing Administration (FHA)-insured home mortgages | more...

September 29, 2021

Do FHA Home Loans Have An Income Cap?

By Joe Wallace

Some borrowers learn that FHA mortgage loans are government-backed and guaranteed by the FHA and HUD, which can lead to certain assumptions about the nature of a government-backed mortgage. One of the misconceptions about FHA home loans is that due to their government association have either an income limit, or are otherwise need-based. Some borrowers might be confusing the government-backed USDA loan program with the FAH loan rules. USDA loans ARE need based. However, FHA loan rules in HUD 4000.1 do not specify a maximum income and do not require a specific financial need to qualify. FHA loans do not have a low-income requirement, a household income cap, or a requirement that you be a first-time buyer. These loans are instead designed for those who want to purchase a home | more...

August 31, 2021

The Final Month Of The COVID-19 FHA Foreclosure Eviction Moratorium

By Joe Wallace

September 1, 2021 marks the start of a countdown–the final days of the FHA foreclosure eviction moratorium issued to help FHA borrowers avoid loan default and foreclosure during the economic hardship of the global COVID-19 pandemic. There were two FHA-wide orders during the pandemic. One was a prohibition on foreclosures on homes securing an FHA mortgage, and the other was a moratorium on foreclosure-related eviction for those with FHA mortgages who were in the foreclosure process when the pandemic hit. The moratorium on FHA foreclosures ended in July 2021, but the foreclosure eviction ban was extended until the end of September 2021. On July 30, 2021, the FHA and HUD issued an announcement stating as such, which included the following: “Foreclosure-related evictions of persons from properties that were secured by | more...

August 30, 2021

FHA Loan Guidelines For Verifying Your Credit History

By Bruce Reichstein

FHA loan rules have a lot to say about what the lender needs to look for to verify a potential FHA borrower’s creditworthiness. No matter if you are looking for a condo loan, a mobile home loan, or you want to build a house on your own land with an FHA construction loan, the requirements in the FHA Lender’s Handbook are identical. There are minimum FICO score requirements, instructions to the lender for reviewing the borrower’s record on-time payments (12 months of reliable payments on all financial obligations is strongly recommended), and much more. One area that is also covered in HUD 4000.1 is what the lender should do if collections are included in the borrower’s credit history. The presence of a collection action on a loan applicant’s record may | more...

July 30, 2021

What You Need To Know About FHA Home Loan Credit Checks

By Joe Wallace

What do first-time home buyers need to understand about the credit check process for getting an FHA mortgage? There are many variables but one thing you can do to get a better understanding of what it takes to be approved for a loan is to start trying to think like a loan officer–their job depends on making sure that you are a good credit risk. How can you help the lender help you? What you don’t know can hurt you in the journey toward buying that first piece of real estate. Before you begin working with a realtor, you should know several things about the credit check process. Credit is a major part of home loan approval and you want to be able to convince your lender you are ready | more...

June 18, 2021

Changes To FHA Home Loan Policy: Student Loan Debt

By Joe Wallace

The Department of Housing and Urban Development official site has published a press release announcing an important revision to FHA Single-Family home loan guidelines in HUD 4000.1 concerning how a participating FHA lender should consider student loan debt as part of the loan approval process. Before the publication of HUD 4000.1, the FHA Single-Family Loan program handbook, FHA loan rules “did not address how Mortgagees should calculate future payments of deferred student loan debt which, once due, could negatively impact a Borrower’s long-term ability to repay their Mortgage and other monthly obligations” according to the HUD press release. What’s more, FHA loan rules did not consider deferred and non-deferred student loan debt separately. When HUD 4000.1 was published to replace HUD 4155, FHA loan rules were modified to require a | more...

June 7, 2021

FHA/HUD Near Current Deadlines For Ending COVID “Flexibilities”

By Bruce Reichstein

On March 13, 2020, the President of the United States declared a national emergency in relation to the COVID-19 pandemic. Not long after, the FHA and HUD published details of altered FHA loan procedures designed to reduce the risk of spreading COVID-19. These altered procedures included modified employment verification, appraisal processes, and appraisal protocols such as exterior-only options. The HUD guidelines for these modified policies were intended to address the specific needs and risks associated with in-person requirements during COVID. Some of the temporary policies were allowed to expire but then got reinstated. Others simply had their deadlines extended. In January of 2021, President Joseph R. Biden announced a plan called the National Strategy for the COVID-19 Response and Pandemic Preparedness, and in response, temporary FHA and HUD policies were | more...

June 2, 2021

HUD Revises FHA Loan Citizenship Rules

By Bruce Reichstein

The Department of Housing and Urban Development has issued a press release which announces important changes to the way participating FHA lenders process home loan applications completed by those who are in the United States but are not American citizens. The policies changed are those that allow a lender to approve FHA home loans for those in the United States under the Deferred Action for Childhood Arrivals (DACA) program. In 2012, the Department of Homeland Security issued a policy for those who entered the United States as minors, and who meet “certain additional guidelines” — these applicants are eligible to request “deferred action from prosecution for removal” from the United States for two years, subject to renewal. This technically makes those eligible under DACA to work legally in the United | more...