Articles Tagged With: FHA Refinance Options

December 9, 2011

FHA Home Loan Resources By State

Did you know that the FHA and HUD offer by-state listings of FHA-related news, programs, home loan resources and other information? While FHA home loans are available nationwide, there are many state and local programs designed to help home owners, FHA borrowers, veterans and others affected by such programs. For example, on the Alabama page at http://portal.hud.gov/hudportal/HUD?src=/states/alabama there is a press release detailing a Department of Housing and Urban Development grant to the State of Alabama to the tune of $120 thousand to fight housing discrimination and uphold fair housing initiatives. On the North Dakota page there are stories of the latest initiatives on the state and local level to assist low-income families. These state page on the FHA official site also contain valuable links to information for foreclosure avoidance, | more...

November 15, 2011

FHA Cash-Out Refinancing Maximum Loan Amounts

By Joe Wallace

A recent reader question came in asking about FHA loan maximum amounts for cash-out refinancing loans–we thought it might be a good time to examine the rules for those maximums. In general, FHA loans have a specific loan-to-value limit. According to FHA.gov, “Effective for case number assignments on or after April 1, 2009, the loan-to-value (LTV) of any cash-out refinance to be insured by FHA may not exceed 85% of the appraiser

October 4, 2011

FHA Loans: Do They Require a Background Check?

By Joe Wallace

Newcomers to FHA loans and home buying in general often wonder how extensive the credit check might be; some wonder if the lender goes beyond examining credit scores and employment history. Given the amount of detail lenders require in order to process FHA home loan applications, it’s not unreasonable to wonder if a background check is part of the application process. FHA requirements for FHA insured mortgage loans do state a credit check is needed that includes residency information, employment history and other details to give an accurate picture of an applicant’s background. The borrower is not “investigated” for details outside of the information needed to determine whether he or she is a good credit risk, but a 2010 law does require additional steps for some types of refinancing loans | more...

August 3, 2011

FHA Section 203(k) Loan Facts

By Joe Wallace

The FHA Section 203(k) loan, sometimes called a rehab loan, the Federal Housing Administration’s “primary program for the rehabilitation and repair of single family properties” according to the official site. The FHA 203(k) is sometimes used in partnership with state or local agencies, non-profits and other groups to rehab homes, but the 203(k) can also be used by individuals to purchase and repair individual properties. The 203(k) section at FHA.gov states, “When a homebuyer wants to purchase a house in need of repair or modernization, the homebuyer usually has to obtain financing first to purchase the dwelling; additional financing to do the rehabilitation construction; and a permanent mortgage when the work is completed to pay off the interim loans with a permanent mortgage. Often the interim financing (the acquisition and | more...

August 2, 2011

FHA Home Loans, Appraisals, and Mold

By Joe Wallace

When looking for a home to purchase with an FHA loan, some borrowers find themselves in a situation where the results of the appraisal recommend mold abatement. Some potential borrowers challenge the mold abatement requirement–you can find many Q&A forums on real estate issues where posters have stated, “I’ve searched and did not find any documents that say that FHA requires mold to be remediated.” FHA standards for homes to be purchased with an FHA insured mortgage loan include a requirement that the property be free from defects and conditions which could affect the health or safety of the purchaser. A borrower may not find a “chapter and verse” type statement saying “Mold abatement is required”, but the health and safety clauses built into FHA loan regulations can and do | more...

July 7, 2011

FHA Loans: What The Lender Looks For In Your Credit Report

By Joe Wallace

When a borrower fills out an FHA loan application, there is a requirement to submit a variety of information including proof of income, residency information, and financial details including all currently open lines of credit. The lender will verify all this information, including credit history. The lender must order credit reports from the three major agencies–Equifax, TransUnion, and Experian. These reports cannot be furnished by the borrower, they must come directly from the credit reporting agencies and must contain no erasures or alterations to the physical report itself. Corrections or deletions of any erroneous information must be made by the borrower through the credit reporting company’s official channels. When the lender gets your credit reports, he or she is looking for a standard set of information as spelled out in | more...

July 5, 2011

FHA Streamline Loan Changes

By Joe Wallace

The FHA Streamline loan program is a refinancing option for FHA borrowers which in most cases allows a no-credit-check refinancing loan. Changes to the program has modified the terms and conditions of FHA streamline loans, and FHA borrowers who looked into the program in the past should know about the updates in order to make a properly informed decision on when to apply for streamline refinancing. The FHA breaks down the modified streamline refinancing loan rules into two different categories. The first is for cases assigned on or after 4/18/2011. the second is for cases between 11/17/2009 and 04/17/2011. The most important details for the new streamline FHA refinancing loan rules affects both categories in the same way. For example, the FHA requires streamline loans the result in a “net | more...

June 9, 2011

FHA and HUD Offer Disaster Relief to Illinois, Oklahoma, Minnesota

By Joe Wallace

Recent storms in Illinois, Oklahoma, Minnesota and elsewhere have prompted a great deal of activity from the FHA and HUD recently. A series of press releases have announced help for states and “other entitlement communities” including the ability to redirect or re-allocate current federal resources toward disaster relief and recovery efforts. HUD also reminds borrowers about its standard types assistance for storms and other natural disasters, including the agency’s policy on foreclosures. “…immediate foreclosure relief – HUD granted a 90-day moratorium on foreclosures and forbearance on foreclosures of Federal Housing Administration (FHA)-insured home mortgages…” according to HUD press release HUDNo.11-116. Other help for FHA borrowers includes the HUD Section 203(h) program which “provides FHA insurance to disaster victims who have lost their homes and are facing the daunting task of | more...

May 26, 2011

FHA Loans And Your Credit–What Is The Lender Looking For?

By Joe Wallace

In our last blog post, we discussed FHA loans and credit history. Many people are afraid to apply for a home loan because of past credit mistakes, but it’s easy to assume the worst about credit reporting, your history with credit, and what an FHA approved lender is looking for when reviewing an FHA loan application. In some cases, those assumptions also apply to a lack of credit history. An FHA lender must investigate the applicant’s credit reports. A few late credit card payments or other minor issues in the past aren’t enough to condemn the borrower or have an application rejected. The FHA rules don’t have a chart for counting credit issues and a cut-off number for how many late payments are too many. Instead, the FHA rules state, | more...

May 19, 2011

FHA Loans: What is a Mortgage Credit Analysis?

By Joe Wallace

When a borrower applies for an FHA home loan, they must fill out a loan application that includes details about past and current employment, debts and lines of credit, plus submit to a credit check. All of this is part of what the FHA calls a Mortgage Credit Analysis. According to the FHA, the purpose of this analysis includes giving an FHA approved lender the ability to determine the applicant’s credit “performance”, their ability to repay an FHA mortgage if the loan is approved, and to check the record to see if the borrower has “sufficient funds to close” if the loan goes through. This credit analysis has specific rules and regulations to make sure it is fair, secure, and not subject to fraud or the accusation of fraud. That | more...