Articles Tagged With: FHA Home Loan

February 25, 2022

Down Payment Help For FHA Mortgages

Who qualifies to get down payment assistance in order to buy a home? If you are using an FHA mortgage, your downpayment requirement is, at a minimum, 3.5%. And while that isn’t as large a down payment as you would make if you wanted to eliminate private mortgage insurance from a conventional home loan, some may struggle to come up with the money down. Buying a home can be expensive. There are inspection and appraisal fees, there may be pest control services to pay for, title searches, and more. Saving early is the key to making your down payment easier to manage in your budget. But even with saving early, extra help may be needed. That’s where down payment assistance programs can come in to help. But what does it | more...

February 17, 2022

Planning An FHA Mortgage

By Joe Wallace

When you decide to buy a home, you don’t just walk out and make an offer on a home. There is a planning and saving stage, a house hunting stage, and an application stage of the home buying process. That’s a bit of an oversimplification of how it works, but even as such it shows that there’s a lot to buying a home–the more planning you can do, the better off you will be. One important issue related to the planning stage of the home loan process involves your budget. Figuring out how much home loan you can afford isn’t just about how your finances look today. You will need to look to the future in terms of your job, your income, any raises or promotions that might affect how | more...

February 15, 2022

FHA Mortgage Insurance: What You Need To Know

By Joe Wallace

When you apply for an FHA mortgage, you are required to have mortgage insurance. This comes in the form of an FHA Up-Front Mortgage Insurance Premium which is paid at closing time in cash or financed into the FHA loan amount. You can do one or the other, but you can’t partially finance this premium. That’s the “up front” part. FHA loans require an annual premium paid in monthly installments. This is called a Mortgage Insurance Premium and is not the same as conventional Private Mortgage Insurance. That is required by conventional lenders for certain mortgages without a 20% down payment or better. Private mortgage insurance is known by the acronym PMI, and some borrowers (even some lenders) use MIP and PMI interchangeably even though they aren’t the same thing. | more...

February 14, 2022

Getting Your Credit Ready For A Mortgage

By Joe Wallace

FHA mortgages generally have more forgiving credit score requirements than some of their conventional counterparts. If you are thinking of applying for a mortgage you definitely want to start reviewing your credit far in advance of the application–that’s advice we give out here on a regular basis and is fairly “Home Loans 101” type information. Newcomers quickly learn that starting work on their credit as early as possible is the best move they can make in the planning stages of the loan. But what isn’t so entry-level advice? What some credit reporting agencies advise on managing your credit with or without a home loan to plan for. The implications of this advice are basically that credit is not a “set and forget” type of issue; for best results, you’ll want | more...

February 7, 2022

What You Should Know About FHA Mortgage Loan Rate Lock Agreements

By Joe Wallace

What should FHA home loan applicants know about the practice of mortgage interest rate lock commitments? This is an important detail of your home loan and it’s best to know how the interest rate lock agreement works ahead of time so you know how and why this part of the mortgage loan process works. What Is An FHA Mortgage Loan Interest Rate Lock Agreement? An interest rate lock protects a borrower from the daily mortgage rate fluctuations that happen naturally due to investor behavior, or other market forces that can change rates. An interest rate lock commitment is not automatic; it must be formally agreed to in writing between the borrower and the lender. An interest rate lock commitment does exactly what it sounds like it does-the lender and borrower | more...

February 4, 2022

FHA Home Loans And Your Downpayment

By Bruce Reichstein

There are good reasons to put more money down on a low-down-payment mortgage like an FHA home loan. There are also important reasons why someone might not be able to pay as much upfront on the home loan as they would like. What are the advantages and disadvantages of a larger downpayment? The biggest disadvantage for some is the basic financial outlay of cash. Financial circumstances don’t permit all buyers to pay a lot out of pocket for their home loans. In such cases, downpayment assistance programs offered by state or local agencies can help those who qualify. For those who can afford to pay more upfront? The most obvious, Home Loans 101-type advice is that a bigger downpayment lowers your interest costs over the lifetime of the loan because | more...

January 31, 2022

FHA Loan Late Payments And Late Fees

By Bruce Reichstein

What happens if you miss your monthly deadline for FHA mortgage loan payments? Nobody serious about home loan planning goes into the process expecting to have missed or late payments down the line. After all, a missed payment can lead to serious issues with the mortgage if you aren’t proactive enough to deal with them right away. Life can and often does get in the way of our financial obligations. With that in mind, what should you know about missing an FHA home loan payment? To start, there are rules that codify in part how the lender is to proceed. These FHA loan rules for late payments are found in HUD 4000.1 A section in that volume titled “Late Charges” explains what the FHA views as a late payment on | more...

January 28, 2022

FHA Home Loans And First-Time Buyers

By Joe Wallace

Are you considering an FHA mortgage as a first-time homebuyer? There are some important things to remember that can help make your home loan journey better. Consider what follows as things to consider adding to your home loan planning checklist. Monitoring your credit is the first step. If you have not started the planning stages of your home loan yet or are in the earliest stages of that, you’re in a great place to start monitoring and working on your credit. If you are farther along in the process and have not started monitoring your credit, do so as soon as you can for best results. Saving money for your home loan expenses is an important part of the planning phase of your mortgage. You should research real estate blogs | more...

January 27, 2022

FHA Home Loan Approval Problems: New Credit Applications

By Joe Wallace

You may have heard advice about seeking new credit while you are in the home loan process. Much of this advice is definitely applicable. Anyone who advises you NOT to apply for new credit once you have started your home loan journey is thinking with your best interests in mind, but what is it about this advice that makes it so critical? A lender doesn’t pull your credit reports just once during the home loan process and if your lender sees new information that potentially changes your ability to qualify for the mortgage it may be necessary to re-approve you for the loan. And that’s just the presence of new credit in your report. What about how a new line of credit potentially affects your debt-to-income ratio? When you apply | more...

January 26, 2022

FHA and HUD Expand REO Sales Options For Owner-Occupiers

By Joe Wallace

They are sometimes known as HUD homes, more formally as HUD real-estate owned homes–properties that were purchased with FHA mortgages that later fell into loan default and ultimately foreclosure. The FHA and HUD, in such cases, have a reimbursement program for the lender but the property itself reverts back to HUD upon foreclosure. The HUD official site states, “A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.” And now, thanks to a move by the FHA and HUD, there are expanded opportunities for borrowers who want to be owner-occupiers to bid on and purchase these HUD homes before | more...