Articles Tagged With: FHA Lenders

Construction Loan Advice For New Borrowers

March 24, 2021

FHA Loan Down Payments: Some Simple Rules

What do you need to know about FHA loan down payment requirements? First, in most cases, a down payment is required, and your down payment requirements are dictated in part by your credit scores. But you also need to know that your down payment could be waived if you are applying for a construction loan and have land equity to use instead. There are FHA loan rules you should know while you are still in the planning stages of an FHA purchase loan. These will help you decide what to do about saving up for a down payment and dealing with certain closing costs. Basic Down Payment Rules As stated above, FHA loan rules usually require a minimum 3.5% down payment for all single-family mortgage loan transactions. But don’t overlook | more...

March 23, 2021

Preparing Your Finances For An FHA Mortgage: Debt

By Joe Wallace

The debt-to-income ratio is a calculation that your lender will use to determine the amount of your monthly financial obligations compared to the amount of income you have. The debt-to-income ratio is an important tool for the lender. The more income you have compared to outgoing payments every month the better, your lender needs to justify you as a good credit risk. So how do borrowers with a lot of debt deal with this problem? This is an important factor because if the ratio is too high yor lender can’t justify the loan. Borrowers should learn what the FHA considers to be “debt” and what things are not automatically counted as part of your debt ratio in order to view their finances the way the lender will. FHA Home Loans | more...

March 22, 2021

FHA Loan Approval: Credit Scores Are Just One Factor

By Bruce Reichstein

Some house hunters worry that they don’t have credit scores good enough to qualify for the mortgage. But it’s easy to lose sight of the fact that FICO scores are not the single determining factor in home loan approval. There Are THREE Important Factors Some FHA loan applicants come to the process knowing that both FICO scores and your record of on-time payments are crucial for loan approval. But even this is an incomplete picture of what your lender is after when trying to approve your home loan application. By this point in our article, you are likely getting the hint that there is indeed a third factor that counts when applying for a mortgage loan, and that factor is your debt-to-income ratio. The participating FHA lender’s job is to | more...

March 19, 2021

HUD Announces Settlement In Wells Fargo Housing Discrimination Case

By Joe Wallace

The Department of Housing And Urban Development has announced a settlement in a housing discrimination case involving Wells Fargo. According to a press release on the HUD official site, Wells Fargo allegedly denied a mortgage loan intended to be used on a group home for persons with disabilities. While this specific case doesn’t seem relevant in the context of an individual applying for a home loan, any form of discrimination in the housing process weakens that process for all borrowers. The HUD official site reports that HUD has approved what is called a Conciliation Agreement between Wells Fargo Bank and a customer named in the complaint. The agreement resolves that customer’s claim that Wells Fargo denied a loan application after learning the loan was intended for the group home for | more...

Home Loans For Building On Your Own Land

March 18, 2021

One-Time Close Construction Loan Advice For New Borrowers

By Joe Wallace

If you have never explored your options to build a house on your own lot with a One-Time Close construction loan, you might be surprised to learn that these loans are open to first-time borrowers and experienced home owners alike. Construction loans have great advantages for those who want to build a primary residence. But there are often important questions borrowers need to be answered before they can make an informed decision on building on their own lot. VA One-Time close mortgages for military members and veterans offer a no downpayment option, and FHA One-Time Close mortgages have a low 3.5% downpayment requirement. And the down payment issue is where we get started with our home loan advice. Down Payment Assistance For Construction Loans Most FHA and VA participating lenders | more...

March 16, 2021

Pre-Purchase Home Loan Advice

By Bruce Reichstein

Looking for a home loan that’s affordable and doesn’t require 20% down? The FHA loan program has something for you. Some are surprised to learn that FHA mortgages are not limited to those in financial need like certain USDA mortgages, and they are not restricted to first-time home buyers. FHA Loan Options Are Diverse You can buy much more than a typical suburban home. Options include getting a condo unit with an FHA mortgage, building a home on your own lot from the ground up using an FHA One-Time Close construction loan, or you can refinance your existing mortgage. That mortgage can be an FHA or non-FHA mortgage using an FHA loan. No matter what kind of home loan you need–a purchase loan, a rehab loan, a refi loan–there are | more...

FHA Construction Loan Rule Changes In 2021

March 2, 2021

One-Time Close Construction Loan Advice

By Bruce Reichstein

If the idea of building a home instead of buying somebody else’s property appeals to you, the One-Time Close construction loan allows you to build a home from the ground up on your own lot (or on land you buy in conjunction with the mortgage). Building a home with plans you approve has plenty of advantages, but it also requires some extra consideration. It’s not terribly complicated to anticipate some important factors associated with your construction loan but it does take some time to get the information you need to make the most informed choices possible for your new home. If you want to build a home on your own lot instead of buying an existing house, the FHA One-Time Close construction mortgage is an option you should seriously consider. | more...

Construction Loans For First-Time Home Buyers

February 26, 2021

Home Loan Approval: Documents You Need To Get There

By Joe Wallace

What’s the most important thing you can do in the planning stages of a new home loan? It really does not matter whether you might be contemplating buying a home with an FHA mortgage or building one on your own lot using an FHA Construction Loan known as the One-Time Close mortgage; there are some documents you will need to gather in the planning stages to help you get closer to loan approval. Some of these documents are no surprise–your most recent pay information is a good example. Your lender will want to see verification of your current income. What is not so obvious? The reality that your loan officer might ask you to provide details about a salary or other income information from your previous employer, especially if you | more...

February 25, 2021

HUD Announces Further Modifications Of Home Loan Policy During COVID-19

By Joe Wallace

The pandemic has forced many business owners, consumers, house hunters, and home sellers to rethink their approach to the task at hand. The FHA and HUD have modified many FHA loan rules to accommodate the need to socially distance and implement other coronavirus mitigation procedures and prevent the spread of the virus. And in 2021, those modifications must continue. On Tuesday, February 23, 2021, the HUD official site announced extensions of already-modified Single Family mortgage loan policies–modifications that would allow the FHA to help “maintain new mortgage originations for homebuyers and allow 203(k) rehabilitation projects to continue during the COVID-19 pandemic”. Extending these policies insures continued flexibility in certain guidelines for single family home loans. Why is it needed? To ensure home loans are available via the FHA program for | more...

February 18, 2021

HUD Further Extends COVID-19 Foreclosure Relief

By Joe Wallace

The FHA and HUD have announced new modifications to coronavirus relief options for FHA borrowers in need of foreclosure avoidance help during the pandemic. Effective immediately, HUD has implemented a variety of modifications: Extended foreclosure and eviction moratoriums now expire June 30, 2021; Deadline for “first legal action” and “Reasonable Diligence Time Frame” is extended to 180 days; COVID-19 Forbearance start dates are now extended to June 30, 2021; HECM extension period is extended to June 30, 2021; HUD now offers up to two additional three-month COVID-19 Forbearance periods or HECM extension periods “for certain Borrowers”; HUD now allows additional Borrowers, “regardless of delinquency status or participation on a COVID-19 Forbearance” to apply for FHA’s COVID-19 Loss Mitigation Options; HUD has removed the restriction on “Borrowers receiving more than one | more...