Articles Tagged With: FHA Loan Rules

September 2, 2015

Some Frequently Asked Questions About The New FHA Loan Rules In HUD 4000.1

On September 14, 2015, a new FHA single-family home loan policy handbook takes effect. It’s known as HUD 4000.1 and has several updates, changes and revisions that will take effect on the 14th. There have been some frequently asked questions about some of the details found in the new handbook–the FHA and HUD have published some answers to those questions in anticipation of the launch date for the new rule book. Here are some of those examples as printed on the FHA/HUD official site–one of the top questions? Whether referral fees will be permitted for the origination of FHA single family mortgage loans. The answer: “The lender, or any of the lenders employees, must not pay or receive, or permit any other party involved in an FHA-insured mortgage transaction to | more...

September 1, 2015

FHA Appraisal Questions: Peeling Paint And Paint Chipping

By Joe Wallace

FHA appraisals can be tricky to understand, depending on the outcome. For example, we get asked several times a year why an FHA appraiser required corrections on cracked or peeling paint on surfaces in a given home. The question is usually associated with the seeming cosmetic nature of these corrections. “Why,” the readers will ask, “is this a must-fix when it’s just some paint peeling off a windowsill or door frame?” The answer in this particular case has a lot to do with lead abatement. Depending on the age of the home, lead paint may or may not be present. The FHA appraisal process requires mandatory correction of peeling paint in order to reduce potential or actual lead hazards. It’s true that this could, in certain cases, be perceived as | more...

September 1, 2015

FHA Loan Rules: Changes Coming

By Joe Wallace

On September 14, 2015, a new FHA Single Family Home Loan rule book will become the official collection of rules and regulations for all FHA single family mortgage loans. Known as HUD Handbook 4000.1, this volume has been getting a variety of updates since it was made available online in May of 2015. There are a collection of changes, additions, and clarifications to FHA single family home loan policies including quality control, compliance, oversight, how to do business with the FHA and much more. At the time of this writing, some changes/updates have not been finished yet, such as the instructions on electronic delivery of FHA appraisals. There is currently an FHA Frequently Asked Questions .PDFthat addresses some of the changes that will go into effect on September 14, 2015 | more...

August 31, 2015

FHA Loan Rules: Divorce and Separations

By Joe Wallace

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 Refinance Loan Choices

By Joe Wallace

When you’re thinking about refinancing an FHA mortgage loan, there are many options to consider. Should you stay with your original lender or does another lender have better terms and/or interest rates? Do you remain in your current adjustable rate mortgage or fixed-rate loan? Do you want cash back in the refinance loan transaction? All of these are important questions to ask. You don’t have to stay with the original lender you took out your first mortgage with; regardless of whether you have an existing FHA loan or a conventional mortgage or even an VA loan, refinancing into an FHA mortgage is definitely an option for you. Your original lender might be willing to offer you better terms since you’re already known at that financial institution, but it’s never safe | 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 26, 2015

FHA Home Loans For Veterans

By Joe Wallace

There are many home loan options for veterans of the United States military, including the VA loan program. But some veterans choose the FHA home loan program instead–there are many reasons why some might choose FHA over a VA loan, and for those who are considering the option, there are some important things to remember about the FHA mortgage loan or refinance loan program. The first is that FHA home loans and refinance loans offer many similar features to VA loans. For example, veterans applying for an FHA mortgage have the option of getting an Energy Efficient Mortgage (EEM) option added to the loan, much in the same way as the VA loan program. An FHA EEM requires the lender and borrower to work together to determine the cost effectiveness | 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...