Articles Tagged With: FHA Updates

January 4, 2016

Mortgage Loan Rate Trends: Closing Out 2015 Higher

In the last week of 2015, we saw mortgage loan rates creeping higher, staying above the four percent mark for 30-year fixed rate mortgage loans. A holiday week can keep rate movements conservative, and two holiday weeks in a row can make things quite calm, but that quiet did not prevent the upward drift of rates. 30-year fixed rate conventional mortgages closed out 2015 in a best execution range between 4.125% and 4.25%. FHA mortgage rates, in spite of the upwards creep we’ve seen in the past two weeks, did not move from their best execution comfort zone of 3.75%. That best execution rate tends to vary more among participating lenders than with conventional loan equivalents, so your experience may depend on the lender. Additionally, best execution rates are not | more...

Can I buy a manufactured home with an FHA loan?

December 16, 2015

FHA Forward Loan Limits For 2016

By Joe Wallace

Recently we wrote about a press release issued by the FHA and HUD announcing FHA loan guaranty limits for the coming new year. The FHA has published two sets of loan limits mortgagee letters–one for Home Equity Conversion Mortgages (FHA HECM loans) and the other for FHA single-family “forward loans”. We covered the FHA HECM loan guaranty limits in a previous blog post; now we turn our attention to the specifics of the FHA forward mortgage loan guaranty limits as published in Mortgagee Letter (ML) 2015-30, which begins by explaining how FHA loan limits are set. According to that mortgagee letter, “The Federal Housing Administration (FHA) calculates forward mortgage limits based on the median house prices in accordance with the National Housing Act. FHAs Single Family forward mortgage limits are | more...

December 2, 2015

HUD 4000.1 On FHA Loan Limits

By Joe Wallace

Ever since the FHA and HUD updated FHA single-family home loan rules previously found in HUD 4155.1 and HUD 4155.2, we’ve been examining critical areas of the new FHA loan rulebook. One such area involves calculating the maximum FHA loan guarantee limit. FHA issues new guidelines for FHA mortgage loan limits each year, but what does HUD 4000.1 say about this process? “The National Housing Act establishes the maximum Mortgage limits and the mortgage amounts for all FHA mortgage insurance programs…Mortgage limits are calculated based on the median house prices in accordance with the statute. FHAs Single Family mortgage limits are set by Metropolitan Statistical Area and county and will be published periodically.” Furthermore, “A Mortgage that is to be insured by FHA cannot exceed the Nationwide Mortgage Limits, the | more...

December 1, 2015

Mortgage Rate Trends: Flat After The Long Weekend

By Joe Wallace

Monday saw no significant activity for mortgage loan interest rates following the long weekend. Tuesday could be–barring any breaking news or unexpected investor activity–equally quiet in anticipation of very important economic data releases coming later in the week. Wednesday through Friday there is increased potential for volatility based on the contents of reports including employment statistics, jobless claims, and more. Depending on the contents of these reports–and any breaking news that may occur in the meantime domestic or international–there’s increased risk of upward movement on mortgage loan rates this week. Industry professionals seem to be using the word “lock” more, pointing out that the closer we get to these economic data releases, the higher the risk of floating, or delaying an interest rate lock commitment with the lender in hopes | more...

November 25, 2015

HUD Settlement With Illinois Landlord Over Lead Hazard

By Joe Wallace

The FHA/HUD official site has issued a press release announcing a settlement in a case involving lead hazards in Illinois rental properties. This may seem at first glance to have nothing to do with FHA home loans. But this case is an important reminder of why it is so important to report issues connected with fair housing, hazardous conditions in housing, and related issues–the victims in cases like these are often the only defense against continued violation of federal laws, environmental guidelines, etc. According to HUDNo. 15-151, the Department of Housing and Urban Development, “announced a settlement with a Rockford, Illinois landlord to resolve a claim he failed to inform tenants, some with young children, that their homes may contain potentially dangerous lead.” According to the press release, the agreement | more...

November 20, 2015

Agreement Reached In Michigan Housing Discrimination Case

By Joe Wallace

The FHA/HUD official site has issued a press release announcing an agreement in a Michigan housing discrimination case. According to HUDNo.15-147, a “concilliation agreement” has been reached between the government and Mortgage One, Inc., of Sterling Heights, Michigan, “resolving allegations of lending discrimination againstan applicant with disabilities.” According to the press release, HUD claimed Mortgage One and a loan officer, “required the mortgage applicant to provide intrusive and unnecessary documentation regarding his disabilities before approving his FHA-insured mortgage”. A persons qualifications to purchase a home should be the only criteria used to evaluate his or her loan application, not whether they are living with a disability, said Gustavo Velasquez, HUD Assistant Secretary for Fair Housing and Equal Opportunity, who was quoted in the press release. He adds, This agreement reaffirms | more...

November 16, 2015

Mortgage Loan Interest Rate Trends: Cautiously Improving

By Joe Wallace

For six days in a row, mortgage rates pushed higher. Then, for three days last week rates either leveled off or tried to improve. We’ve seen a general upward trend since Fed statements about a possible interest rate hike; the trends seems to be upwards for now in anticipation of the December Fed announcement that could reveal more about that possible rate hike. And in the meantime, breaking economic news or world events could also come together to influence rates depending on the nature of those headlines or events. It’s not just domestic economic news at work as an influencing factor on mortgage loan rates. All the talk of the Fed raising rates has markets and investors reacting in ways that put upward pressure on mortgage rates in general. 30-year | more...

November 9, 2015

Mortgage Rate Trends: Higher On Friday After Strong Jobs Report

By Joe Wallace

Last week was a tough one for mortgage loan rates–a strong jobs report, Fed testimony on a possible December interest rate hike, and more have combined and helped to push mortgage rates higher. Since our last report, 30-year fixed rate conventional mortgages have broken into the low four percent zone; at the time of this writing those rates (best execution) are reported in a range between 4.0% and 4.125%. FHA mortgage rates have also moved higher, leaving the previous comfort zone (best execution) of 3.5% behind in favor of rates at 3.75%. Rates shifted so dramatically that FHA mortgage best execution rates didn’t even move into a range of rates with the previously reported 3.5% at the low end–we just saw them shift from 3.5% to 3.75%. Remember, these are | more...

November 3, 2015

FHA EEM “Stretch Ratios” For Existing Construction Loans

By Joe Wallace

In our last blog post we discussed a new partnership between the FHA/HUD and the Department of Energy which is allowing eligible borrowers to get access to increased “stretch ratios’ under FHA energy efficient mortgages in 2016. According to an FHA press release, “FHAs existing EEH policy allows stretch ratios for homes that are built or retrofitted to the 2000 International Energy Conservation Code (IECC). For standard FHA loans, debt-to-income (DTI) ratios are limited to 31 percent (front-end) and 43 percent (back-end).” How do these ratios “stretch”? According to the press release, “Under FHA policy for the EEH mortgage, these DTI ratios can be increased to 33 percent and 45 percentrespectively. To increase opportunities for homeowners to achieve and benefit from an energy efficient home, FHA is adding a new | more...

October 10, 2015

Mortgage Rate Trends: Ending The Week Holding Steady After Upward Movement

By Joe Wallace

Mortgage rates closed out a week of upward movement with a hold-steady day on Friday. The three-day bank holiday weekend had rates staying still as bond market activity drew to a close in anticipation of the short trading week to come, so 30-year fixed rate mortgages are basically at 3.875% best execution, though our sources report some lenders may offer extremely well-qualified applicants something closer to 3.75% (best execution). FHA mortgage rates ended the week at 3.5% best execution. It’s far too early to tell whether this might be a new “comfort zone” for FHA rates–the last one was 3.75% and that held out for a long time–but if upward pressure continues on rates, it’s likely we’ll see that number fade away in favor of that previous 3.75%. But next | more...