Articles Tagged With: FHA

February 28, 2018

Know Your FHA Loan Options

Do you know your FHA home loan options? There are many things you can do with an FHA mortgage and buying a new home is just one of them. You can use an FHA home loan to buy, refinance, rehab, or upgrade a principal residence, with lower down payments and protections for the borrower when paying off early. FHA New Home Loans Did you know you can use an FHA mortgage to buy an existing home or have one built for you from the ground up? Buying an existing property is one of the most common uses of an FHA mortgage, but you can apply for an FHA One-Time Close Construction Loan (also known as an FHA Construction-To-Permanent loan) using an approved builder to have a house built brand new. | more...

Rent Or Buy? Arguments For Purchasing A Home With An FHA Mortgage

February 27, 2018

FHA Home Loan Down Payment Rules You Should Know

By Joe Wallace

FHA home loan down payment rules you should know include the minimum amount down, acceptable sources of down payment funds, and how other closing costs and associated expenses related to your down payment requirements. Do you know how your chosen FHA lender will calculate your down payment? Knowing before you apply can help plan and save for this and other required closing costs. FHA Loan Down Payments: A Minimum Required Investment FHA loan rules in HUD 4000.1 refer to the down payment as a minimum required investment (also referred to as an MRI for short), not to be confused with the borrower’s Total Required Investment, described in HUD 4000.1 as: “Total Required Investment refers to the amount the Borrower must contribute to the transaction including the Borrower’s downpayment and the | more...

February 23, 2018

FHA Announces Foreclosure Avoidance Help For Federal Disaster Areas

By Joe Wallace

The FHA has announced extended foreclosure relief measures for those in qualifying federal disaster areas. According to a press release on the FHA official site, new guidance for participating FHA lenders will apply for those affected by a wide range of natural disasters including: Louisiana (Hurricane Harvey) DR-4345 Texas (Hurricane Harvey) DR-4332 Florida (Hurricane Irma) DR-4337 Georgia (Hurricane Irma) DR-4338 Puerto Rico (Hurricane Irma) DR-4336 South Carolina (Hurricane Irma) DR-4346 Virgin Islands (Hurricane Irma) DR-4335 Puerto Rico (Hurricane Maria) DR-4339 Virgin Islands (Hurricane Maria) DR-4340 California (Wildfires) DR-4344 or California (Wildfires, Flooding, Mud Flows, Debris Flows) FEMA-DR-4353 There is a lengthy description of some of the new program changes (which we will cover in another blog post) but one of the most important developments included in the FHA announcement has | more...

February 19, 2018

Happy Presidents’ Day 2018

By Bruce Reichstein

Happy Presidents’ Day 2018! Today banks and markets are closed, and we pause from our usual schedule of writing posts and answering questions about FHA home loans to observe the holiday. We return with our regular content schedule tomorrow. Thank you very much for reading!

February 16, 2018

FHA 203(k) Rehab Mortgages: Who Does The Rehab Work?

By Joe Wallace

When it comes to FHA 203(k) rehab loans, many borrowers want to know who does the work? Can the borrower hire a contractor, is the borrower required to do the work themselves? What are the rules? The guidelines for the FHA 203(k) rehab loan program are found in HUD 4000.1, which states that certain standards are in place when trying to select the contractors to do the labor. For starters, this type of loan requires that the borrower use the services of a 203(k) loan consultant. “The Mortgagee must select an FHA-approved 203(k) Consultant from the FHA 203(k) Consultant Roster in FHAC. The Mortgagee must not use the services of a Consultant who has demonstrated previous poor performance based on reviews performed by the Mortgagee. The Consultant must inspect the | more...

February 15, 2018

Should I Refinance My Home Loan With An FHA Mortgage?

By Bruce Reichstein

Should I refinance my home with an FHA mortgage? There are several reasons why it’s good to consider your FHA options when it’s time to start planning a refi loan. I Want To Refinance To Get A Lower Interest Rate If you pay attention to online mortgage loan interest rate reports, you’ll see that in general FHA mortgage loan rates are lower than their conventional counterparts. The interest rate issue can be hard for some to understand because they see these rates compared side-by-side and assume those numbers are at or near what they will be offered if they applied at that moment. But interest rates are negotiated between the borrower and lender for FHA refinance loans, and a borrower’s credit plays a large part in determining what interest rates | more...

February 13, 2018

What Can Affect An FHA Appraisal Or Inspection?

By Bruce Reichstein

What can affect an FHA appraisal or an FHA-required inspection? There are many factors that might influence the outcome of these procedures. For example, borrowers who are having a home custom-built using an FHA One-Time Close construction loan will learn about appraisal requirements that include noting the proximity of the project to gas stations, power lines, and other safety-related issues. The rules that instruct the lender and appraiser in these areas can be found in the FHA loan handbook, HUD 4000.1. Airport hazards, slush pits, and operating oil wells are just some areas the appraiser will note where applicable. For projects classified as New Construction under FHA loan rules, the appraiser must note the general environmental conditions of the area of the construction project and adjacent areas. According to HUD | more...

February 13, 2018

Am I Eligible For An FHA Mortgage?

By Joe Wallace

Am I eligible for an FHA mortgage? That is a very common question, but many borrowers have a specific reason for asking-they want to know if a certain credit problem or work/life situation might disqualify them from an FHA loan. I Have A Recent Bankruptcy Borrowers with bankruptcy issues will have to discuss their situation with a participating lender, but in general at the very minimum you will be required by FHA guidelines to wait a full year (called a “seasoning period”) before applying for a new loan. In some cases you may be required to wait longer, and lender standards apply above and beyond the FHA loan rules. Getting a loan post-bankruptcy requires the applicant to have good credit habits post-bankruptcy, and in some cases you may need the | more...

February 12, 2018

Who Can Apply For FHA Reverse Mortgages?

By Joe Wallace

Who can apply for an FHA reverse mortgage? Borrowing money to take advantage of the value in the home is not a new concept, but the reverse mortgage is a type of loan that’s quite different than a standard FHA refi loan. What Is The FHA Reverse Mortgage? A reverse mortgage is a loan that obligates the borrower without requiring monthly mortgage payments. FHA reverse mortgages, also known as Home Equity Conversion Mortgages or HECMs for short, offer the borrower cash or a line of credit in an amount agreed upon between the borrower and lender. That amount is determined in part by the value of the home, so FHA HECM loans will require a new appraisal to see what the current fair market value of the property might be. | more...

February 7, 2018

What Are The Differences Between OTC FHA Construction Loans And Other FHA Home Loans?

By Bruce Reichstein

What are the basic differences between FHA One-Time Close / Single Close construction loans and other types of FHA mortgages? Borrowers should understand the basic differences and how they will affect your transaction.FHA One-Time Construction Loans / Single-Close Construction Loans Have Different Appraisal Requirements When an FHA loan applicant wants to purchase a home that is considered “existing construction”, which has been built for at least a year or more with at least one owner, the appraisal process happens as a condition of loan approval to insure the property meets minimum FHA standards. When you apply for an FHA One-Time Close construction loan, also known as an FHA construction-to-permanent loan, an inspection is required to insure the property meets minimum standards. HUD 4000.1 explains what the inspection requirements are for | more...