Articles Tagged With: FHA Loan Approval

July 20, 2023

Home Loan Approval Questions And Answers

What does it take to get approved for an FHA mortgage? The answers may surprise you. Did you know there are some persistent myths about the FHA home loan program that stop some people from considering it as an option? FHA Loan Myths You Should Know Some believe FHA loans are need-based mortgages, believing that only those with income below a certain level can apply. This is not true. A percentage of new borrowers sometimes believe they must be a first-time home buyer to use government-backed loan programs like FHA home loans. When it comes to some loan programs (USDA loans) this is closer to being true, but not for FHA loans. You can find programs aimed at first-time buyers. But in many cases this is for those who qualify | more...

July 7, 2023

Signs You Are Not Ready To Apply For A Home Loan

By Joe Wallace

How does a first-time buyer know they are ready to apply for a home loan? There are some instances where a first-time borrower is definitely NOT ready, do you know what they are? You Don’t Know Your FICO Scores If you don’t know what your FICO scores are, you aren’t truly prepared to apply for a home loan. You need to know what the lender will know when she reviews your credit report. If you apply without knowing your scores, you risk wasting time and money. You Haven’t Reviewed Your Credit Report In The Last Months Leading Up To Your Credit Application If you don’t know what your loan officer will see when your credit report is pulled, you aren’t ready to apply for a loan. Evidence of identity theft, | more...

June 23, 2023

FHA Mortgage Loan Terms: Understanding Equity

By Joe Wallace

Home equity is an important term to understand when you’re applying for any kind of mortgage loan, but for some loans, equity is a larger factor than others. For example, when you apply for a new purchase FHA loan to buy a home, you start out with 3.5% of the adjusted price of the home as your equity. That’s the amount of your down payment, and the equity grows over time with the number of payments you make. The more you pay down your FHA mortgage, the more equity you accrue. When you apply for a home equity loan, a home equity line of credit, or an FHA Home Equity Conversion Mortgage (HECM), you’re applying for a loan based on the amount of equity you have built up in the | more...

June 12, 2023

Is Summer The Best Time For House Hunting?

By Joe Wallace

When is the best time of year to search for your new home? Spring and summer are the most comfortable times to look, but those who put up with a little inconvenience from the cold and late-year inclement weather may save more than they realized thanks to a more eager seller. It always pays to look for a home when the buying season is in full swing, but you may have more options than you think by extending your house hunt into fall and winter if necessary. Buying A House During House Hunting Season (Spring and Summer) Yes, the weather is better, potential buyers can take a leisurely look around the property, and the overall experience may be more pleasant. But there is more competition for homes in the good | more...

June 9, 2023

Should You Apply For An FHA Adjustable-Rate Mortgage?

By Joe Wallace

Borrowers considering their FHA mortgage loan options might wonder about an FHA Adjustable Rate Mortgage or FHA ARM loan option instead of an FHA fixed-rate home loan. It is a great idea to compare the features of both types of loan side-by-side to see which might make sense for you. The motivation to do this now has much to do with the interest rate environment we are still dealing with in 2023–in spite of hopes of improvement as the summer wears on. Why would an FHA ARM loan make more sense for some borrowers? Because an ARM offers a lower introductory or teaser interest rate. You may have the option to keep that rate for a full year or as long as ten years. Much will depend on the type | more...

June 5, 2023

HUD Takes Action To End Appraisal Bias

By Joe Wallace

The Department of Housing and Urban Development is acting against bias in the appraisal system. “Owning a home provides a path to the American dream. Yet, that dream has been deferred for Black and Brown people, as we have consistently had our homes under-valued,” according to HUD Secretary Marcia L. Fudge, quoted in the 1 June 2023 HUD press release on these appraisal reforms. Fudge adds, “Having your home undervalued is bigger than just a number on a page. It can be the difference between getting a loan and not – between having enough money for retirement or not.” According to Fudge, the PAVE Task Force is a project meant to focus on “taking bold action to address appraisal bias – and renewing our commitment to doing everything in our | more...

May 30, 2023

FHA Home Loan Down Payment Rules in 2023

By Joe Wallace

What must you know about the down payment requirement for an FHA mortgage? FHA home loans have specific rules about the amount of your down payment and where it can come from. Knowing the down payment rules before you start saving for your home loan may make the entire process more efficient, especially if you know you’re required to give the lender the sources of your down payment money and document it accordingly. FHA Loan Rules: Down Payments Are Different From Other FHA Loan Costs Some want to know if their down payment requirement can include the money they pay toward closing costs, lender fees, or earnest money. But such costs do not count as part of your down payment amount; you must provide funds for your entire down payment | more...

May 26, 2023

Is Your Credit Ready For A Mortgage?

By Joe Wallace

Do you worry about your ability to obtain or use credit because of identity theft, errors in your credit report, or coronavirus-related financial issues that still linger even after the end of the pandemic? You can protect your credit and work on your credit rating; you don’t have to sit idly by and wonder what’s happening with your FICO scores and credit report. One of the first steps for many is to use credit monitoring. This type of service offered by third parties allows you to see changes in your credit report, including activities and scores (over a period of time, not necessarily in real-time) that may affect your ability to get credit in the future. Credit monitoring is a good way to start because using such a service makes | more...

May 25, 2023

Do FHA Loan Payments Increase Over Time?

By Joe Wallace

Could the monthly amount due on an FHA mortgage increase over time? If you want a fixed-rate mortgage, that may seem like a silly question. After all, isn’t the idea behind a fixed-rate home loan to provide predictability and stability in the payments? The short answer is yes, but there are still factors that could change the total amount of mortgage-related expenses over time. Depending on circumstances, the amount you owe each month may change depending on variables such as changes in your insurance, property taxes, and homeowner’s association fees. Adjustable Rate Mortgages Your monthly mortgage payment will change if you have an Adjustable Rate Mortgage or ARM loan. An ARM loan features an introductory period with a (typically lower) “teaser” rate, but once that introductory period ends? The home | more...

May 16, 2023

FHA Home Loan Numbers You Need To Know

By Joe Wallace

What numbers do you need to know when researching your options for an FHA mortgage? The amount of your down payment, mortgage insurance, and how much your seller may contribute toward your closing costs are all important to know in your new mortgage’s planning and saving stages. FHA Loan Numbers: Down Payments FHA loan rules say if you come to the application process with FICO scores at 580 or above you can make the lowest down payment; 3.5% of the price of the home. FHA loan rules say those with FICO scores between 500 and 579 must put down 10%. As you can see, it pays to work on your credit well before your loan application. FHA Loan Numbers: Appraisal Fees There is no set national price for appraisal fees, | more...