Articles Tagged With: First-time Home Buyer

January 17, 2023

Closing Costs Versus Down Payment

Some borrowers get confused over the differences between closing costs and the required minimum down payment of 3.5% needed for FHA home loans. The confusion often comes over what is considered a down payment versus what is considered to be part of the borrower’s closing costs. The most basic thing to know is that the FHA home loan down payment is a standalone payment. It is NOT reduced by the amount of closing costs you pay such as the lender’s fee, appraisal costs, title fees, inspection fees, etc. But that isn’t all-FHA home loan rules, for example, do not permit your down payment to come from the seller. But FHA loan rules DO permit your seller to contribute a certain amount toward the closing costs of the loan. Note the | more...

January 10, 2023

Rent Or Buy? FHA Loans Can Help You Own Your Home

By Joe Wallace

Is it wiser to rent or to buy your home? For some borrowers, it makes more sense to make a mortgage payment than to commit to a monthly rental payment. These borrowers should definitely explore their FHA home loan options and compare the cost of renting to the costs of owning. FHA Loans Can Help You To Stop Paying Rent Buying your home with an FHA mortgage means no more waiting for the landlord to repair crucial areas of the home. Homeowners are free to schedule or make their own repairs or upgrades without having to wait for someone else to get around to scheduling those necessary appointments. Buying a home with an FHA mortgage means no more apartment hunting, paying application fees or security deposits, etc. FHA Mortgage Loans | more...

What Credit Score Is Needed For An FHA Mortgage?

December 30, 2022

Are You Ready To Buy A Home With An FHA Mortgage?

By Bruce Reichstein

Are you ready to buy a home with an FHA mortgage? There are ways to tell how close you are to being ready to start house hunting and move out of the planning stages of your new home loan. Do You Know Your FHA Loan Limit? FHA loan limits are higher in 2023, you will want to know how much higher the limit may be in your housing market compared to last year. FHA home loan limits vary depending on the housing market; some areas are more expensive than others and have a higher loan limit, while others are “average” and conform to the median FHA loan limit nationwide. Some housing markets may be less expensive than others and feature a lower FHA loan limit, but the only way to | more...

December 28, 2022

Buying A Home In 2023

By Joe Wallace

Are you making plans to buy a home with an FHA mortgage in the new year? Your timing might be better than you think; housing markets are cooling which may lead (over time) to lower prices, decreased demand for houses on the market, and more negotiating power for the buyer. But there are a few important questions. How long does the market improve before we see conditions begin to level off? There is no way to predict what might happen going forward, and it’s important to compare and ask lenders about what rates might do in the months leading up to your FHA loan application in 2023. It is unrealistic to expect your lender to be a fortune teller, nobody knows when home loan interest rates might recover closer to | more...

December 12, 2022

Housing Market And Home Equity: What You Need To Know In 2023

By Joe Wallace

The mortgage industry has been coming down from the highs of summer, 2022. Fed actions to raise interest rates had an effect on the housing market (indirectly–the Fed sets the rates on federal loan funds, not mortgage loan interest rates) and as a result, conditions have started to cool to the point where mortgage rates actually dropped in December. Slowing Demand As the housing market cools, a course correction for home equity is an important factor to think about. According to certain mortgage industry sources, there are plenty of indicators that home equity is indeed starting to come back down. Lower demand and lower prices can translate into lower equity. Consider what the publication Mortgage Industry News printed about a report by CoreLogic in 2022: By the end of the | more...

December 5, 2022

FHA Home Loan Tips: What To Do, What Not To Do

By Joe Wallace

If you are new to the home-buying process, there are some definite things to do and things NOT to do when preparing for your mortgage. Some of these areas may seem obvious, but you might be surprised at the number of people who don’t give themselves enough planning and saving time ahead of the home loan process. FHA Loan Tips: Start Planning Early The moment you realize you want to purchase a home using an FHA mortgage, it is time to begin looking at your finances to see how a new budget can be made. This is because buying a home (no matter what kind of loan you are using) can be an expensive process. You want to start saving immediately for the down payment, but also for the costs | more...

November 28, 2022

FHA Loan Approval Rules For First-Time Home Buyers

By Joe Wallace

FHA home loans are often misunderstood. Some think they are need-based loans like some offered via the USDA program, while others believe FHA mortgages can only be approved for first-time home buyers. Typically, we write that FHA mortgages do not actually offer extra perks for first-time buyers, but there is a new exception to that notion you should know about. What kind of exception? In 2022, HUD made a policy change and issued a mortgagee letter announcing that in 2022 the FHA would allow participating lenders to consider positive rental history as a factor in home loan approval. Typically, such rental verification is not a part of most credit reports provided for FHA-insured products that require credit approval and “when provided,” rental verification, “generally exists as separate documentation” the lender | more...

November 21, 2022

Housing Market Improvements And Your FHA Home Loan in 2023

By Joe Wallace

Are you looking at 2023 and considering your home loan options to buy a house with an FHA mortgage? There is news from the housing sector that could mean improved conditions for a home loan in the new year. While it’s true that changes in the housing market don’t happen overnight, some mortgage blogs and news outlets are reporting that the typical time houses spend on the market is increasing. Thats a good sign considering how competitive the housing market was last summer. Is this the only indication that conditions may be improving for house hunters? Demand for houses seems to be falling and home loan interest rates are showing signs of gradual improvement. This could make 2023 a much better time to shop for a house than the summer | more...

November 18, 2022

Buying A Home With An FHA Loan In 2023

By Joe Wallace

The last weeks of the old year usually bring speculation about what the next year will bring, especially in terms of the economy and the real estate market. Housing market issues were a serious concern in 2022. In the wake of this year’s rising mortgage rates and house prices; what are finance blogs and market watchers saying about what’s next in 2023? Many finance websites report a general expectation that rates and house prices may improve in the new year. But the degree of that improvement is what’s at issue. Some feel big changes are coming (compared to current conditions) while others feel those gains could be more modest. The National Association of Realtors are on record saying 2023 may see mortgage rates hover between 6% and 7%. There will | more...

November 16, 2022

FHA Home Loans And Housing Counseling

By Bruce Reichstein

Even in the best of times, buying a home can be tough. It’s hard for first-time buyers to know what to expect, and in an era of rising interest rates and limited housing supply, it’s more important than ever to be a fully-informed borrower. FHA home loans are for many different kinds of borrowers. They are for experienced and first-time home buyers alike. But it’s easy to feel overwhelmed by the process if you are new to it or haven’t purchased real estate before. That is one reason why it’s a very good idea to consider talking to a HUD-approved housing counselor. Did you know you can call the FHA at their toll-free number, 1-800 CALL FHA, and request a referral to an approved housing counselor? The Department of Housing | more...