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Articles Tagged With: FHA Requirements

April 11, 2011

FHA Streamline Refinancing Rule Changes In Full Effect This Week

By Bruce Reichstein

In February 2011, the FHA and HUD issued an announcement about changes to the Streamline Refinancing program. Many alterations to the program were made, some effective immediately when the guidance was issued in February, other changes were designed to be implemented no later than 60 days from the date of Mortgagee Letter 2011-11, February 14th. One of the important changes in that letter affects FHA non-credit qualifying streamline refinancing. The FHA and HUD wanted to have greater risk control over the FHA insurance fund; the FHA determined stronger rules were needed to safeguard FHA streamline loans. According to the mortgagee letter, “mortgagees must not use an appraisal to increase the insurable mortgage balance beyond the sum of the outstanding principal balance and the new Up-Front Mortgage Insurance Premium.” The new | more...

 

April 6, 2011

FHA Loans: Can A Borrower Have More Than One? (Part Two)

By Joe Wallace

In our last blog post we discussed FHA loans and whether a borrower can apply for a second one while maintaining the first. This situation is different than refinancing or getting a second mortgage–the situation in question involves the borrower’s ability under FHA regulations to buy another property with a new FHA insured loan. The FHA only allows this under specific circumstances. For example, a borrower who relocates to a new area outside a “reasonable commuting distance” may be allowed to apply for a second FHA loan to buy a new property in the new location. In such cases the borrower is allowed to apply for a new loan but isn’t forced to sell the old property. This makes the old home a possible rental unit under the right circumstances–the | more...

 

April 6, 2011

FHA Loans: Can a Borrower Have More Than One?

By Joe Wallace

For the typical home owner, applying for an FHA loan is a major financial commitment. The monthly mortgage payments are an important part of any budget and borrowers are encouraged to plan carefully before closing the deal to make sure they will be able to afford the loan over the lifetime of the FHA insured mortgage. Some FHA borrowers have circumstances that get them thinking about a second FHA loan for any number of reasons. Some borrowers decide to invest in real estate, others may be required to relocate to another state for career purposes, others may be non-occupying co-borrowers on an FHA loan. Can a borrower have more than one FHA loan at a time? On the surface, the FHA answer seems to be no. According to the FHA, | more...

 

March 31, 2011

What Does “Buying a HUD Home” Mean?

By Joe Wallace

The FHA loan program features a variety of loan products for qualifying borrowers to get into affordable housing by applying for a loan with an FHA guaranty. But the FHA doesn’t just guaranty loans, it also offers house hunters the option of purchasing property owned by the Department of Housing and Urban Development, also known as a “HUD home”. According to the FHA official site, “A HUD home is a 1-to-4 unit residential property acquired by HUD as a result of a foreclosure action on an FHA-insured mortgage. HUD becomes the property owner and offers it for sale to recover the loss on the foreclosure claim.” HUD homes are available to the public–not just FHA borrowers. Anyone may purchase a HUD home but getting one is a different process than | more...

 

March 31, 2011

FHA Loan Facts About Loan Applications

By Bruce Reichstein

If you’re new to the FHA loan process, there are many things to learn, and it’s easy to assume things about an FHA mortgage that might not be true. Did you know there are federal laws that require specific steps

 

March 30, 2011

FHA Loans and Fair Lending: The Schwab Settlement

By Joe Wallace

Recent headlines and press releases have called attention to the Fair Housing Act, and the FHA’s anti-discrimination policies for FHA loan applicants. The Department of Housing and Urban Development recently announced a settlement between Charles Schwab Bank and a Louisiana family after a Fair Housing Act complaint. FHA loan applicants and conventional borrowers alike are protected from discriminatory housing practices under the Fair Housing Act, which includes refusal to issue loans based on an applicant’s disabled status. According to a press release at FHA.gov, “Charles Schwab Bank has agreed to pay $30,000 settling allegations that the bank refused to accept a loan application from the adult son of a Metairie,

 

March 29, 2011

FHA Refinancing Loans-Rule Clarifications

By Joe Wallace

In February of 2011, the FHA released clarification to its rules covering FHA Streamline Refinancing Mortgages, designed to be implemented 60 days from the issuance of FHA Mortgagee Letter 2011-11, sent on February 14, 2011. The FHA clarified rules for the Streamline Refinancing Loan, which previously had language requiring specific, tangible benefits to the borrower such as a reduction in interest rates or monthly mortgage payments. There is still a requirement for FHA Streamline Refinancing Loans to have a specific benefit to the borrower, but the FHA