January 2, 2017
Happy New Year 2017!
Happy New Year! Today is the observed New Year’s holiday, which means that markets, many banks, and government agencies are closed today. We resume our normal posting schedule tomorrow. Thank you for reading!
Articles Tagged With: FHA Loans
December 30, 2016
Property Types Eligible For FHA Mortgages in 2017
FHA mortgages for single family residences include a wide variety of eligible property types. You can purchase a typical suburban home with an FHA loan, a condo unit, manufactured home, modular home, or other approved structure meant to house a family that qualified under FHA loan rules. These properties can be single-unit homes or have up to four living units. While it’s true that not all lenders approve loans for all the possible types of housing available under the FHA program (some lenders choose not to loan money for mobile homes or new construction homes, for example) there are some general guidelines about the types of property you can purchase from a participating lender. FHA mortgages are approved for those who intend to be owner-occupiers. FHA mortgages are not available | more...
December 27, 2016
HUD Announces Additional Relief To Disaster Areas
As 2016 draws to a close, HUD announces that some of the hardest hit natural disaster areas are getting nearly $2 billion in additional federal relief. According to a Department of Housing and Urban Development press release, HUD “awarded an additional $1.8 billion to help Louisiana, West Virginia, Texas, North Carolina, South Carolina and Florida to recover after severe flooding events that occurred earlier this year. Provided through HUDs Community Development Block Grant Disaster Recovery (CDBG-DR) Program, these recovery funds will assist the most impacted communities that experienced the most serious damage to their housing stock.” Earlier this month, President Obama signed the Fiscal Year 2017 Further Continuing Resolution, which became law on December 10, 2016. The resolution is described on the HUD official site as a stopgap spending measure. | more...
December 26, 2016
Happy Holidays!
Happy Holidays 2016! The Monday AFTER December 25 might seem to be a strange time to make that statement, but today is the observed holiday since Christmas came over the weekend this year. Many banks are closed, the markets that affect mortgage rates aren’t operating to day, and we too observe the extended holiday weekend. We’ll resume our usual posting schedule on Tuesday including an updated look at mortgage rate trends. Thank you for reading!
December 22, 2016
Mortgage Rate Trends: Slightly Lower
Since our last report on mortgage rate trends, we’ve seen a minor bit of improvement in interest rates, but the numbers still remain at highs not seen in the last couple of years. The improvements will likely be reflected in closing costs where applicable, and the range of rates is still at or near what it’s been in recent days. That means that 30-year fixed rate conventional mortgages are holding in a range between 4.375% at the very bottom end and 4.5% at the top end, best execution. FHA mortgage rates are holding in a best execution comfort zone of 4.0%, though if upward movement resumes we could see this turn into a range of rates also. Best execution rates assume ideal borrowers. Your FICO score, loan repayment history, and | more...
December 20, 2016
Deferred Obligations and FHA Loans
A reader asks, “How do you calculate monthly payments for estimated payment to begin when schooling is complete?” With student loans, there are two types of payments, one of which may apply in this case. Ongoing payments and deferred payments have different requirements. It’s likely safe to assume that this reader question refers to how a lender is to process student loan information as part of the applicant’s debt-to-income ratio. FHA loan rules in HUD 4000.1 include instructions to the lender for processing student loan debt information both as a “deferred obligation” that has not come due yet, and as an ongoing payment where applicable. HUD 4000.1 instructs the lender to use the actual amount of the student loan payment wherever possible, but in cases where the loan is deferred | more...
December 19, 2016
FICO Scores And FHA Loans
Your credit report and FICO scores are very important factors when it comes to getting an FHA loan approved. Do you know what your FICO score is and how it affects your home loan? The U.S. government’s consumer watchdog agency, the Consumer Financial Protection Bureau, has a definition of FICO scores on its’ official site, which includes the following: “A FICO score is a particular brand of credit score. A credit score is a number that is used to predict how likely you are to pay back a loan on time. Credit scores are used by companies to make decisions such as whether to offer you a mortgage or a credit card. They are also used to determine the interest rate you receive on a loan or credit card, and | more...
December 16, 2016
HUD Adds New Housing Counseling Requirements
Housing counseling is an important resource for those who want to apply for a mortgage loan. When borrowers decide to start on the journey to home ownership, there can be many areas they are unsure about. That’s one reason why it can be helpful to contact the FHA directly at their toll-free number (1-800 CALL FHA) to request a referral to a local, HUD-approved housing counselor to get expert advice and help in areas related to budgeting for a mortgage payment, credit issues, the home loan process and more. In some cases, certain types of counseling are actually required as a condition of FHA loan approval; this is true for FHA Home Equity Conversion Mortgages (HECM), where all borrowers must attend counseling to insure they understand the nature of HECM | more...
December 15, 2016
FHA Mortgages: Five Simple Things To Know
If you are considering an FHA home loan, there are a few simple basics to keep in mind about your loan application that will help you in both the planning stages and the application stage of the loan. Did you know? 1. FHA mortgages require a down payment, but that down payment is lower than many conventional mortgages. FHA home loans require a down payment of 3.5%, but you may encounter conventional mortgage loan requirements as high as 20%. This is an important factor when trying to plan a budget for your new monthly mortgage payment. FHA mortgages have down payments calculated as a percentage of the adjusted price of the home. 2. FHA mortgages require an appraisal to calculate the fair market value of the property and to insure | more...
December 14, 2016
Family Leave And FHA Loans
Family leave is an important issue for lenders trying to determine a borrower’s verifiable income, debt-to-income ratio, etc. We get many questions on this topic in the comments section, including this most recent query: “How does FHA treat income after family leave? Is an 8 month maternity leave considered a job gap?” The rules that govern gaps in employment, temporary leave, and related issues can be found in HUD 4000.1. Temporary leave such as maternity leave or disability leave is addressed, but first the FHA loan rule book defines what it considers to be “gaps in employment”: “For Borrowers with gaps in employment of six months or more (an extended absence), the Mortgagee may consider the Borrowers current income as Effective Income if it can verify and document that: -the | more...