Articles Tagged With: FHA Loan Requirements

July 29, 2015

FHA Mortgage Loan Interest Rate Trends

For about ten business days now we’ve watched mortgage loan interest rates either hold steady or make small improvements. The gains aren’t dramatic enough from day to day to force much change in the best execution numbers we report here; instead borrowers likely notice the difference in closing costs. But whatever the case, ten days of rates that aren’t getting any higher is a good thing after the sustained upward trend we’ve witnessed this summer. Yesterday (Tuesday July 28) we saw the first day of slightly higher rates since that holding-to-slightly-improved trend began. The move higher certainly wasn’t enough to push rates out of their current comfort zones, so we have 30-year fixed rate conventional mortgage loans holding steady (best execution) at the 4.0% to 4.125% range we’ve been discussing | more...

July 29, 2015

FHA Refinance Loan Options

By Joe Wallace

Looking for a refinance loan? Do you know what your options are as a homeowner when it comes to refinancing from a non-FHA loan to an FHA mortgage? Or are you in need of an FHA-to-FHA refinance? There are many options available, some of which may surprise you. Did you know there is one type of FHA refinancing which has no FHA-required credit check? Borrowers who are currently paying on adjustable rate mortgages should take a close look at FHA refinance loan options for a variety of reasons. Those who have non-FHA loans can refinance into fixed rate FHA loans, or refinance into another adjustable rate mortgage (ARM)–FHA loan rules permit both options for qualified borrowers. Non-FHA borrowers looking to refinance into an FHA mortgage will be required to get | more...

July 28, 2015

FHA Loans, Foundation Trouble, And Home Inspections

By Joe Wallace

A reader got in touch with us to ask about a situation where a home with foundation problems was purchased with an FHA loan. The reader says a home inspector was not hired because the foundation issue was “supposed to be taken care of” prior to the borrower moving in. Later, the borrower discovered that no corrections to the foundation had been made and further problems were discovered. The main question was whether or not the borrower has any legal recourse in situations like these. FHA loan rules and the FHA/HUD official site are very specific when it comes to borrowers who rely on FHA appraisals and their outcomes instead of hiring a home inspector to take a more in-depth look at the property. The FHA appraisal is not a | more...

Can I buy a manufactured home with an FHA loan?

July 24, 2015

FHA Loan Questions: Late Payment History

By Joe Wallace

A recent reader question about FHA loans and missed payments reminds us how important it is to examine your credit report and repayment history on all financial obligations long before you apply for a new home loan. The reader wanted to know if late payments on a student loan would affect chances for FHA home loan approval. The question mentioned that the reader’s current mortgage loan is current, but that late payments on the student loan were on her credit record. Does this reader have a chance for a new FHA loan? The answer is complicated because of two things. A borrower with a current mortgage trying to apply for a new purchase FHA home loan would have to declare that the new home is to be the borrower’s primary | more...

July 23, 2015

FHA Loan Down Payment Rules: Acceptable Sources of Down Payment Funds

By Joe Wallace

A recent reader question in our comments section involved the source of down payment funds. The reader wanted to know if cash saved at home could be used to make an FHA loan down payment. The answer is simple, yet can get more complicated depending on circumstances. The FHA loan rules state that down payment funds must be verified. The reason for this includes requiring the lender to insure that down payment money does not come from payday loans, credit card cash advances or any other type of “non-collateralized” loan. FHA loan rules have a list of acceptable sources, which include (but are not limited to) proceeds from the sale of investments, property, bonds, etc. Cash saved at home is acceptable, as are trade equity, rent credit, even gift funds–provided | more...

When Is An FHA Loan Better Than A Conventional Loan?

July 22, 2015

FHA Streamline Refinance Loans

By Joe Wallace

If you have an existing FHA mortgage loan, you can apply for a refinance loan with no FHA required credit check or appraisal that results in a reduction in your monthly mortgage payment and/or interest rate in most cases. Called the FHA Streamline Refinance loan, these loans are only for existing FHA mortgages and offer no cash back to the borrower. FHA loan rules permit Streamline loans for those who have assumed FHA mortgages. According to the FHA official site (www.fha.gov), the FHA, “does not require an appraisal on a streamline refinance. These transactions can be made with or without an appraisal.” If there is a lender required appraisal, there may be corrections noted. According to FHA loan rules, these corrections may or may not need to be made as | more...

July 21, 2015

FHA Mortgage Loan Myths

By Joe Wallace

From time to time we get asked questions about FHA loans that reflect common misconceptions and myths about the program. Borrowers sometimes assume things about FHA single family home loans that aren’t true and it’s always a good idea to post some basic facts about the program from time to time to remind people what’s true and untrue about FHA mortgages. FHA loans, for example, aren’t limited to people on fixed incomes, or to those who must demonstrate a need for a non-conventional loan. FHA mortgages are open to all qualified applicants. Your FICO scores, job history, debt-to-income ratio and other financial qualifications are what determine your ability to get an FHA loan. There is no such thing as earning “too much income” for an FHA loan. There’s also no | more...

July 20, 2015

FHA Loan Employment History Rules

By Joe Wallace

One common topic many borrowers have questions about when they want to apply for FHA loans involves employment history. How long do you have to be on the job with your current employer before you can qualify for an FHA mortgage loan? Believe it or not, FHA loan rules state that there is no minimum length of time you have to be with your current employers in order to be considered for a loan. According to HUD 4155.1 Chapter Four: “To be eligible for a mortgage, FHA does not require a minimum length of time that a borrower must have held a position of employment. However, the lender must verify the borrowers employment for the most recent two full years, and the borrower must –explain any gaps in employment that | more...

July 16, 2015

FHA Loans And Federal Law

By Joe Wallace

We’ve been discussing FHA loans, the Fair Housing act, and other federal laws lately. There have been many changes to applicable federal law in recent times that can and do directly affect the mortgage lending process. It’s no surprise that the FHA single family home loan program, being created by the federal government, would lead the way in pro-consumer regulatory changes and set the example when it comes to requiring equal treatment for all qualified borrowers. But some of the most important federal laws and regulations aren’t brand new–they’ve been around for quite some time. Some have been further modified to make them more inclusive. The Fair Housing Act now includes language that protects people regardless of their gender identity, family status, sexual orientation and much more. FHA loan rules | more...

July 16, 2015

FHA Loans And The Equal Credit Opportunity Act

By Joe Wallace

From time to time, we get reader questions asking whether certain types of income such as public assistance, alimony, or other types of payments might count for or against a borrower trying to apply for an FHA home loan. These are logical concerns; how many potential FHA borrowers might shy away from applying because they mistakenly believe that certain types of income such as public aid might actually count against them when it comes to loan approval? The rules that govern these issues are found in HUD 4155.2 Chapter One under a heading that discusses federal law known as the Equal Credit Opportunity Act or ECOA. Did you know that ECOA rules prohibit a lender from denying credit to a borrower simply because he or she receives public assistance? Chapter | more...