Articles Tagged With: FHA Loan Requirements

August 31, 2015

FHA Loan Rules: Divorce and Separations

We frequently handle reader questions in the comments section regarding FHA loan policies that affect borrowers going through a legal separation or divorce. In some cases, the questions have a lot to do with why a lender may require the spouse’s credit information or other details even though the couple is legally separated. One recent question addressed just that-the FHA loan applicant was being asked by the lender about spouse credit issues even though there was a legal judgment or ruling stating the couple was legally separated and not involved in joint credit or shared debt according to the terms of the legal agreement. Why would the lender, the reader wondered, still require the spouse’s financial or credit information? Unfortunately, there is no one specific answer to give. Some states | more...

August 31, 2015

FHA Loan Questions: Title Problems

By Joe Wallace

What follows should not be construed as legal advice. As a general rule, it’s a smart philosophy to seek legal advice for a lawyer and be wary of legal guidance from a non-lawyer. The best legal advice any non-lawyer can dispense is, “talk to a lawyer”. A reader got in touch recently with a question about FHA refinance loans. He asked about a situation where the bank’s title search uncovered a lien against the property from a third party. “…Title search showed that the property was also deeded to another person that had a lien on the property.” “We went to two trusted lawyers that advised us to file Bankruptcy because the other property owner was in trouble with the law and that the Title insurance we paid for was | more...

Can I buy a manufactured home with an FHA loan?

August 28, 2015

FHA Loan Rules, Lender Standards, And Your FHA Loan Application

By Joe Wallace

Some of the most common questions we get asked in the comments section (where we field all our reader questions about FHA loans and refinance loans) involve what seem to be gray areas surrounding an FHA mortgage. For example, “Will a certain condition in the home make the property fail the FHA appraisal?” or, “How low can my FICO score be?” Some portions of the FHA loan process are dealt with specifically in FHA loan rules. For example, borrowers with FICO scores lower than 500 are not eligible for an FHA loan. Borrowers who are currently delinquent on Federal debts may have difficulty getting loan approval until the situation is resolved with payment or a payment plan. Certain types of conditions–homes located within a high pressure gas pipeline easement, for | more...

August 27, 2015

FHA Mortgage Loan Interest Rate Trends: Creeping Higher

By Joe Wallace

You may have noticed we’ve been posting more this week on mortgage loan interest rate trends: overseas economic headlines from China and elsewhere have contributed to a volatile market environment that can definitely affect mortgage loan interest rates, so we’re posting more as the situation warrants. Mid-week, mortgage rates began creeping higher, but this time influenced by bond market activity–our sources point to a weak five-year Treasury auction that began putting upward pressure on mortgage loan rates in the afternoon on Wednesday, resulting in a range of best execution rates for 30-year fixed rate conventional mortgages between the previously reported 3.875% and 4.0%. Yes,we’re getting back into that old, familiar 4.0% zone, at least in the short term. FHA mortgage loan rates have not, best execution, budged from the 3.75% | more...

August 26, 2015

Choices To Consider For Your New FHA Home Loan

By Joe Wallace

Are you considering an FHA home loan? You’ve got plenty of options open to you, but sometimes it’s good to review those options to make sure you aren’t missing any potential avenues for savings or better opportunities. The choice of lenders is the first thing many borrowers think of when they consider their FHA loan options. It’s perfectly reasonable to consider using the bank you currently have to work with on an FHA loan, provided that company is a participating FHA lender. But what if your lender doesn’t offer FHA loans, or restricts their offerings to areas you aren’t currently interested in? Some borrowers want to finance condo loans, manufactured housing or mobile homes, etc. Does your lender offer loans for these purchases? Shopping around for a new lender is | more...

August 25, 2015

Preparing For Your FHA Loan Application

By Joe Wallace

There are several factors that affect your FHA loan application. Some begin the journey to home ownership with methodical planning and research, others may become interested after seeing an ad or a home for sale that looks particularly tempting. If you’re brand new to the home loan process, here are some steps that can help you get ready to make the tough choices about your home and FHA loan options. Know Your Market Which homes in which neighborhoods have the most competitive prices? Is the housing market in your area on the rise? Is it changing due to construction or new development in areas that were under-utilized or previously blighted? What would your new neighborhood offer you in terms of services such as shopping, day care, etc.? Know Your Lenders | more...

August 24, 2015

FHA Loans And Non-Purchasing Spouses

By Joe Wallace

There are a lot of questions asked about FHA loans and how spouses can buy together. Can the FICO scores of one spouse make up for the lower scores of the other borrower? Can one spouse’s income offset the lower income of the other? How does state law factor into FHA loan applications when spouses apply? All valid questions. But what about circumstances where one spouse is not borrowing? Does an FHA loan require action on the part of a non-borrowing spouse? The answer can be influenced by state law, lender standards, and FHA loan regulations. At the time of this writing, FHA loan rules that govern non-purchasing spouses can be found in HUD 4155.1 Chapter Four, Section A. There we learn the following: “If required by state law in | more...

August 24, 2015

FHA Loans For Borrowers With Past Delinquencies, Defaults, Or Claims On FHA Mortgages

By Joe Wallace

Of all the questions we get in our comments section about FHA loans, one of the most common topics involves new FHA loans for borrowers who have past bankruptcies, judgments, foreclosures, etc. The answers to these questions depend greatly on circumstance, but what do the FHA loan rules have to say specifically about those who want to apply for a new FHA mortgage, but have had problems with a previous FHA-guaranteed loan? The answers to these questions can be found, at the time of this writing, in HUD 4155.1, Chapter Four, which instructs the lender as follows: “If the borrower has had past delinquencies or has defaulted on an FHA-insured loan, there is a three-year waiting period before he/she can regain eligibility for another FHA-insured mortgage. The three-year waiting period | more...

August 21, 2015

FHA Single Family Home Loan Rules On Owner-Occupier Status and Investment Properties

By Joe Wallace

FHA loan rules on the nature of “owner-occupied” residences state that a single-family mortgage loan guaranteed by the FHA is only for borrowers who want to live in the home they buy. The “owner occupier” nature of FHA home loans is secured by rules in HUD 4155.1 designed to prevent investors from using this type of FHA mortgage. You’ll find the guidelines for owner-occupied residences in Chapter Four, Section B, which states: “At least one borrower must occupy the property and sign the security instrument and the mortgage note in order for the property to be considered owner-occupied. FHA security instruments require a borrower to establish bona fide occupancy in a home as the borrowers principal residence within 60 days of signing the security instrument, with continued occupancy for at | more...

August 21, 2015

FHA Mortgage Rate Trends: Lower After Fed Minutes Are Released

By Joe Wallace

Mortgage loan rates have been in a back-and-forth mode this week. One day they rise, altering closing costs for the most part rather than the actual best execution rate, the next day they fall, with the same result. On Wednesday all eyes were on the release of Fed minutes, which detail the meeting held last month. The details of that report sent investors into activity that benefits mortgage rates, and while the best execution numbers we reported in our last blog post haven’t changed, some borrowers may notice the alterations in the form of lower closing costs as previously mentioned. 30-year fixed rate conventional mortgages were reported at 4.0% best execution at mid-week, with some lenders coming in at sub-four percent best execution rates. Best execution rates are not available | more...