December 6, 2010
The FHA has an extensive list of borrowers' rights, all designed to inform and protect government home loan applicants. But what do these rights mean? For the first time home buyer, some of these rights need a bit of explanation--an experienced house hunter is probably more aware of their rights the second time around, and newcomers to FHA home loans should know their rights and obligations before they need them.
November 30, 2010
The FHA offers an adjustable rate mortgage, also known as an FHA ARM loan. These loans offer an introductory interest rate which is subject to change after the initial fixed rate period. That period varies depending on the loan--there are hybrid ARM loans available that feature different periods--but once the introductory rate period has elapsed, the adjustable rate is subject to a cap that applies either year-to-year or over the lifetime of the FHA loan. The initial interest rate is often lower than the fixed rate of conventional home loans, which is why many people consider ARM loans even in spite of the fears generated by the housing crisis of 2008.
November 15, 2010
In November 2010, the Department of Housing and Urban Development announced a pilot program that offers qualified FHA loan applicants a low-cost loan to help homeowners install energy saving upgrades to their homes. The new FHA PowerSaver loan is scheduled to be offered in conjunction with a program called Recovery Through Retrofit which was launched by Vice President Joe Biden in 2009. The new FHA PowerSaver loan is substantial--up to $25,000 for qualified FHA loan applicants--and can be used to install insulation, solar panels, geothermal energy systems and much more.
November 9, 2010
FHA loan applicants go into the process expecting to pay money for a down payment, mortgage insurance, closing costs and the typical fees associated with getting an FHA mortgage. What they don't expect is to get money back from the Department of Housing and Urban Development. But in some cases, that's exactly what they'll get.
November 4, 2010
The Real Estate Settlement Procedures Act or RESPA, requires buyers to be more fully informed as to the costs of an FHA loan including how much they must pay for closing costs, and how much is refundable vs. non-refundable if the buyer has a change of mind and backs out of the loan. These FHA requirements are designed to protect borrowers from "gotcha" charges, unexpected expenses and other problems; RESPA is also designed to help lenders and buyers work together knowing that all terms are understood and expected.
November 4, 2010
For FHA borrowers who live in areas with seasonally high utility bills, there is help from the FHA in the form of the FHA Energy-Efficient Mortgage or EEM. This is a program that started as an experiment in 1992 and expanded to a full-time national FHA loan option in 1995.