Articles Tagged With: FHA Loan Requirements

February 13, 2015

FHA Loans For Properties Served By Cisterns: A Reader Question

A reader asks, “How do we get a fha loan for homes on cisterns, They are common for our area 81082. Can they be certified and inspected and to what standard? and by who?” This reader question comes in response in the comments section to an earlier post we wrote titled, FHA Loan Reader Questions: Cisterns which includes the following information: “FHA loan rules state that a cistern–basically a water tank using the classic definition of the word–is unacceptable. However, in certain cases a waiver may be applied for in situations the FHA defines as those where cistern use is common.” “Such waivers are not automatic and a borrower in need of such a waiver should call the FHA at 1-800 CALL FHA to learn how to apply, or discuss | more...

February 13, 2015

FHA Loan Questions: Late Payments

By Joe Wallace

A reader asks, “As a co-borrower on a home for my daughter-in-law, I was never notified by the mortgage company that loan was late. DIL told that as long as she was in repayment, they would not report late. What do I do?” FHA loan rules can’t address all circumstances, and there are some areas involving an FHA loan that depend strictly on the arrangements made between the borrowers and the lender. When it comes to co-borrowing, any occupying or non-occupying co-borrower who needs to be kept in the loop with regard to the status of the mortgage (payments made, payments missed, etc) may need to make prior arrangements with the lender. This may be crucial when it comes to late or missed payments–how is the co-borrower to know the | more...

February 12, 2015

FHA Loan Minimum Property Requirements: Tripping Hazards On The Property

By Joe Wallace

A reader asks, “What are regulations on trip hazards? I have a listing where the tree roots lifted up the driveway quite a bit. The tree has been removed, but roots and buckled blacktop drive still there.” FHA minimum property requirements don’t cover each and every situation where corrections might need to be made to the property in order for it to meet standards–in many cases the FHA minimum requirement includes a general rule that may be reinforced by state and/or local building code. According to the FHA/HUD official site, “HUD requires that each property insured with an FHA mortgage meet one of the nationally recognized building codes or a State or local building code based on a nationally recognized building code. In areas where such State or local codes | more...

February 10, 2015

FHA Loan Reader Questions: FHA Loans After A Short Sale

By Joe Wallace

A reader asks, “We had a job loss and were working on a loan modification that was supposedly going to be approved and was then denied. We filed and were discharged from CH 7 back in 2010, never reaffirmed the mortgage, but paid on it until it was obvious we were not going to get any cooperation from the lender. Moved out and short sold in May 2013 and are now looking to buy again.” “What is the FHA standard for the downpayment we’d have to make? We have been told 20%, but read elsewhere that for a mortgage that was discharged in bankruptcy and never reaffirmed, that the applicable period for any wait time is the date of the bankruptcy discharge and not the date of the short sale? | more...

February 9, 2015

FHA Loans and Wage Garnishment: A Reader Question

By Joe Wallace

A reader asks, “if I have state taxes being taken out of my check as a garnishment will that disqualify me for FHA loan?” FHA loan rules found in HUD 4155.1 Chapter Four address delinquent federal taxes in association with an FHA loan, but not state taxes specifically. However, we can get an idea of the FHA’s position on this issue by reading what it has to say about a borrower who may be delinquent on federal taxes: From Chapter Four of HUD 4155.1: “If, after checking public records, credit information or CAIVRS, a borrower is found to be presently delinquent on any Federal debt or has had a lien (including taxes) placed against his/her property for a debt owed to the Federal government, he/she is not eligible for an | more...

February 7, 2015

FHA Loans and Identity Theft Issues: A Reader Question

By Joe Wallace

A reader asks, “We have applied for a FHA loan and until yesterday, had no idea that that someone had filed a tax return under my social security number back in 2012. I have submitted the proper forms to the IRS, and they have my accurate 2012 tax return on file. Because I submitted the tax return late, I have never been contacted by the IRS regarding this.” “It was not until I called to set up a payment program for the taxes that I owe, that it was brought to my attention. Is this a 100% deal breaker for the loan, if my account is under review for identity theft? Can the underwriters still get the tax information that they need or is all my information frozen? I am | more...

February 6, 2015

FHA Loan Reader Questions: Seasoning Period Following Foreclosure

By Joe Wallace

A reader contacted us with a lengthy question about FHA home loans following a foreclosure. Here’s the question: “Are there any new rules as it relates to months required with a foreclosure expected in 2015? I had the same situation in which in my bankruptcy was my current house we had purchased after going through a divorce and loosing my employment. On my credit report it clearly shows that the loan to that property was part of the bankruptcy and was discharged Sept 13,2010. I am trying to refinance with my current husband under an FHA Loan and I have gone to multiple lenders and once all is reviewed they come back with the same response that since my deed to the property we included in the bankruptcy did not | more...

February 5, 2015

FHA Loan Rules For New Loans Following Chapter 7

By Joe Wallace

A reader asks, “In june 2015, i will have two years post bankruptcy, chapter 7. I want to purchase a home, first time buyer, credit score of 710, my question is, Am I able to start the process now, or should i wait the two full year mark? ( I was told this by a mortgage rep that fha requires two full years post bk) .” The FHA official site has a FAQ page about FHA loans after a Chapter 7 bankruptcy proceeding. It says: “A Chapter 7 bankruptcy (liquidation) does not disqualify a borrower from obtaining an FHA mortgage if at least two years have elapsed since the date of the discharge of the bankruptcy.” The reader’s comment about the two year waiting period is correct, based on the | more...

February 4, 2015

FHA Loan Rules On Giving Personal Property To The Buyer

By Joe Wallace

Sometimes when a borrower purchases a home, the seller will offer to to throw in some types of personal property as part of the deal. Knowing that the FHA has strict rules on something known as “inducements to purchase”, does the FHA allow or deny sellers to offer personal property to sweeten the real estate deal? An inducement to purchase is when the seller offers to pay certain expenses on behalf of the borrower that exceed six percent of the sales price or appraised value (whichever one is lower). But offering property isn’t the same as paying in the eyes of some–does that mean the property is exempt from inducements to purchase regulations? The answer to this question can be found in HUD 4155.1, Chapter Two, Section A. That part | more...

February 4, 2015

FHA Loan Reader Questions: Help With an Existing FHA Mortgage

By Joe Wallace

We get many questions about FHA home loans. Some of them come in the form of detailed queries about specifics of a certain FHA loan program, others come as more general questions about the nature or scope of FHA home loans. Here’s one of the more generalized questions that came in recently. A reader asks: “What about help with a current FHA loan? Remodification?” It’s not clear what the reader is getting at with this question, but assuming the reader wants assistance with an existing FHA loan in order to get into a lower monthly payment, the good news is that there is definitely assistance available in the form of FHA Streamline Refinancing. FHA Streamline refinance loans are for borrowers with existing FHA mortgages who want a lower interest rate, | more...