Articles Tagged With: FHA Home Loan

September 27, 2018

Will I Be Approved For An FHA Mortgage Loan?

We get many reader questions asking about scenarios they are worried might cause trouble when it’s time to apply for an FHA mortgage. Here are some of the most common questions related to situations that may or may not be an issue when applying for an FHA home loan or FHA refinance loan. I have a FICO score of 500. Can I Qualify For An FHA Mortgage? Technically the answer is yes, if you go by FHA loan standards alone. However, lender standards for FICO scores and loan approval will also apply and the lender’s FICO score requirements are likely to be higher than the FHA loan minimums. Those with FICO scores between 500 and 579 are technically eligible for an FHA loan but they are required to pay 10% | more...

September 6, 2018

FHA Home Loans: Five Reasons To Buy A Home Instead Of Renting

By Bruce Reichstein

In our last blog post we discussed some reasons to purchase a home with an FHA mortgage instead of renting a property. Most of the reasons discussed in the previous post had to do with financial matters including the fact that renters gain no equity in their rental homes, and they have no ability to apply for a cash-out refinance loan based on the current value of the home. Reverse mortgages are unavailable to renters, too. But there are other reasons to buy a home and not rent. Are you thinking of an FHA mortgage to buy a home based on some of the reasons listed below? There are compelling arguments for each of the five reasons. #5: Buying A Home Means More Privacy Borrowers who own their own homes | more...

August 13, 2018

Who Needs Credit Repair Before Applying For An FHA Mortgage?

By Joe Wallace

Who needs credit repair before applying for an FHA mortgage? If you are worried about your ability to qualify for a home loan because of past financial issues, credit mistakes, or even identity theft, it’s important to begin reviewing your credit and working on raising your credit scores as early as possible before committing to a mortgage loan application. Don’t wait to start working on your credit, begin today! What Kind Of Credit Repair Is Needed? There are many different things you can do to work on your credit rating and credit history but what we NOT suggesting is that you pay a third party offering to “remove all negative credit information” from your credit report or other things that are not actually possible. The best way to begin working | more...

August 3, 2018

FHA Loan Down Payment Assistance Rules

By Bruce Reichstein

FHA loan rules governing down payments and down payment assistance are found in HUD 4000.1, the FHA single-family loan handbook. FHA loan rules require both a minimum down payment and also that the down payment comes from an approved source. FHA loan rules permit borrowers to get down payment assistance from third parties, but when down payment help is offered, it must meet the same types of requirements that borrower-provided down payment funds. What are the rules for down payment assistance for FHA mortgages? FHA Home Loan Down Payments Must Be Sourced Properly FHA loan down payment money can come from a borrower’s cash reserves, cashed-in investments, checking accounts, and a variety of other sources. But it cannot come from a payday loan, cash advance, or other restricted sources. The | more...

July 25, 2018

How Many FHA Mortgages Can I Have?

By Bruce Reichstein

How many FHA mortgages can I have? This question is often on the minds of those who are interested in buying an investment property using an FHA mortgage. Understanding the FHA loan rules in this area can save a potential borrower a lot of time. FHA Home Loans For Investment Property? FHA home loans cannot be used for investment properties. In this context, the phrase “investment property” refers to a single-family home with between one and four units that the borrower does not intend to personally occupy. It also refers to any type of intermittent-occupancy property such as a bed-and-breakfast, condohotel, or other property that is not primarily residential in nature and that the borrower won’t personally live in as her or his home. FHA Loan Rules For Occupancy and | more...

July 3, 2018

Seven Facts About FHA Home Loans

By Joe Wallace

Seven facts about FHA home loans you should know include lower credit score requirements and down payments than conventional mortgage counterparts. The other five facts are just as useful to a house hunter as the low down payment and FHA credit score rules. FHA Home Loan Limits Are Adjusted Yearly And Vary Depending On The Housing Market Not all housing markets have the same costs or median house prices. A Zillow.com report for home values in 2018 says houses in California may average around $500,000 while homes in Pennsylvania average around $160,000. FHA home loan limits for high-cost and low-cost areas are adjusted rather than featuring an one-size-fits-all approach. FHA Loan Down Payment Requirements Compared To Conventional Mortgage Loan Requirements FHA loans specify down payment minimums between 3.5% of the | more...

June 12, 2018

Do You Suffer From Home Loan Anxiety?

By Joe Wallace

Do you suffer from home loan anxiety? There are many people who want to apply for an FHA mortgage loan, often first-time home buyers looking at an existing construction loan or an FHA One-Time Close construction loan, who begin to worry about getting their loan application approved. Are You Worried About Being Able To Afford Your FHA Mortgage? There is good news for those who are worried they might not be able to afford the FHA home loan and can’t decide whether or not to apply. But there are tools you can use to help get an estimate of how much your FHA mortgage payment might run every month in the form of online mortgage calculators. These tools ask you to input an estimated price of the home, potential down | more...

June 11, 2018

FHA Loan-To-Value Limits: More Rules You Should Know

By Bruce Reichstein

In a previous blog post, we discussed some of the basic loan-to-value ratio rules (LTV) for FHA loans. Your loan-to-value ratio is calculated based on the amount of the required down payment a borrower has to make as part of the FHA mortgage loan transaction. When you buy a home using an FHA mortgage, the loan-to-value ratio can be affected by your FICO scores. A higher down payment requirement means a different LTV than for those who make the lowest possible downpayment on an FHA mortgage loan of 3.5% of the adjusted value of the property. But credit score issues aren’t the only things that can affect a borrower’s LTV on an FHA mortgage to buy a new home. Some FHA loan transactions, under FHA loan policy, require as much | more...

May 29, 2018

Can Military Members Refinance A VA Mortgage To An FHA Loan?

By Joe Wallace

Can a military member or veteran with a VA mortgage loan refinance that loan into an FHA mortgage? If a VA borrower wanted to refinance using an FHA Rehab loan, for example, is such a transaction possible? Some online research into the possibility of a “VA rehab loan” turns up results that indicate that a borrower might have a difficult time finding a lender willing to issue the right kind of refinance loan for the borrower’s needs in this particular area. VA loan rules basically address cash-out refinancing, Interest Rate Reduction Refinancing Loans (IRRRLs) and refinancing loans to cure a delinquent mortgage. There is a section under “other refinancing loans” for VA refinance options that include a construction loan, but the VA in general does not offer the same kind | more...

May 21, 2018

FHA Loan Rules For Investment Properties

By Joe Wallace

Admittedly, the title, “FHA Loan Rules For Investment Properties” might sound a little misleading; the FHA lender’s handbook HUD 4000.1 states clearly on page 142, “Investment Properties are not eligible for FHA insurance.” But what is the FHA definition of an investment property? The answer to that question is twofold-to understand what constitutes an investment property, we have to examine what is NOT an investment. What is the type of home loan the FHA does guarantee? FHA mortgages are primarily for owner-occupiers. At least one borrower obligated on the mortgage must live in the home as her permanent, principal residence within a reasonable time after the loan closes. In some cases, FHA loan rules make provisions for borrowers who want to use an FHA loan for a secondary residence, but | more...