Articles Tagged With: HUD

August 4, 2016

Facts About FHA Adjustable Rate Mortgages

If you are considering your FHA loan options, at some point you’ll likely consider your choices between mortgage loan interest rate options. Qualified borrowers can choose between a fixed-rate FHA mortgage or an adjustable rate loan. Fixed rate loans seem simple and straightforward enough. The borrower applies for a home loan at an interest rate negotiated between borrower and lender. But what about adjustable rate mortgages? These loans, often called ARM or FHA ARM loans, feature an introductory rate, and a higher rate that begins at a specified point in the course of the mortgage. According to the FHA loan rulebook, HUD 4000.1, “The Mortgagee must establish the initial interest rate and the margin. The margin must be constant for the entire term of the Mortgage.” How long does your | more...

August 1, 2016

HUD Announces Settlement In Pennsylvania Housing Discrimination Case

By Joe Wallace

The Department of Housing and Urban Development has announced a settlement in a Pennsylvania housing discrimination case involving a loan applicant on maternity leave. According to the press release on the HUD official site, “…a Conciliation Agreement with Philadelphia-based Citizens Bank of Pennsylvania and Providence, Rhode Island-based Citizens Bank, collectively known as Citizens Bank, settling allegations that the bank violated the Fair Housing Act when it told a female applicant that she would need to return to work before her application for a home equity line of credit could be approved.” Fair Housing Act laws state that it is illegal to discriminate against borrowers, “in the terms, conditions, or privileges associated with the sale or rental of a dwelling on the basis of familial status”, which includes denying a mortgage | more...

July 21, 2016

FHA Revises HECM Policy To Include Third Party Tax Verification Fee

By Joe Wallace

FHA loan rules for Home Equity Conversion Mortgages (HECM) have been modified by the agency to include approval of third party fees for property tax verification. According to FHA Mortgagee Letter 2016-10, the third party fees will be added to the list of approved charges associated with FHA HECM loans, but the verification fees must meet FHA requirements. “A Third Party Property Tax Verification Fee is a fee charged to the mortgagee by a third party to verify the mortgagors property tax payment history and the annual amount of property taxes due for a specific property” states the FHA Mortgagee letter. “FHA is adding the Third Party Property Tax Verification Fee to the list of allowable charges and fees that may be paid by the mortgagor.” According to the mortgagee | more...

July 20, 2016

FHA Loans For Properties With PACE Assessments

By Joe Wallace

The FHA has announced it will insure mortgages on qualifying homes that have PACE assessments. According to a press release on the FHA/HUD official site, the move was initiated to help encourage the use of clean energy. “In order to enable homeowners seeking clean energy technologies in their homes to leverage a range of financing options, the Federal Housing Administration (FHA) today announced guidance that makes clear the circumstances under which it will insure mortgages on properties that include Property Assessed Clean Energy (PACE) assessments. FHA will now approve purchase and refinance mortgage applications in states that treat PACE obligations as special assessments similar to property taxes.” That’s according to the July 19, 2016 press release, which explains that the reason PACE assessments have been troublesome in the past is | more...

What happens to my FHA loan in a natural disaster?

July 11, 2016

Home Loan Debt Ratios Explained

By Joe Wallace

Analyzing Your Debt Ratio from FHA.com on Vimeo. When you fill out a home loan application, your lender will need employment and income documentation in order to process your loan. The lender is responsible for verifying that you have employment and that your income is sufficient to justify the loan. Not all income counts as “verifiable” by the lender; FHA loan rules have guidelines that include making sure the income is stable and likely to continue. Your lender may also have standards which must be met where income is concerned. There are many types of income, and not all of it comes from employment. Do you receive government assistance, get payments from a trust fund, are entitled to pay or benefits from a government agency related to disability, child support, | more...

July 6, 2016

Mortgage Loan Interest Rate Trends: Even Lower

By Joe Wallace

Tuesday marked the first day back from the long holiday weekend, and it brought with it lower rates. That makes seven consecutive business days in a row that mortgage loan rates have improved, and conventional rates are now in some cases, best execution, in line with FHA mortgage loan interest rates. We’ve seen a general downward trend in mortgage loan rates ever since Britain voted “leave” in its national referendum on staying in or leaving the European Union. The fallout from the “leave” vote continues, and as a result the negative economic consequences have helped rates stay low. 30-year fixed rate conventional mortgages are being reported (at the time of this writing) between 3.25 and 3.375% best execution. Compare that to FHA best execution rates of 3.25% and it’s clear | more...

June 30, 2016

HUD Publishes Early Findings From Home Buyer Literacy Study

By Joe Wallace

Financial literacy is an important part of being a well-informed home buyer. For those just starting out on the journey toward home ownership, there can be a great deal of learning to do; how FICO scores affect your ability to purchase a home, how open lines of credit can and often do factor into a lender’s decision to approve or deny a mortgage, etc. HUD launched a study to see how home buyer education and certain types of financial counseling might make a difference to house hunters. According to a recent press release at the HUD official site, “The U.S. Department of Housing and Urban Development (HUD) today published early findings from a rigorous, large-scale, random assignment study on the benefits that housing education and counseling provides to first-time homebuyers.” | more...

June 13, 2016

HUD Announces First Healthy Homes Month

By Joe Wallace

The Department of Housing and Urban Development has announced that June is the first-ever Healthy Homes Month, and is working to raise awareness of hazards in the home including lead-based paint, asbestos, and ways to make the home a healthier environment. According to a press release at the HUD official site (HUD.gov), “Most Americans spend up to 90 percent of their time indoors, exposing them to home health and safety hazards ranging from asthma triggers to potentially deadly pollutants like asbestos and lead-based paint. To reinforce the connection between a family’s health and their homes, the U.S. Department of Housing and Urban Development is declaring this June as the first-ever National Healthy Homes Month.” The program was initiated by the HUD Office of Lead Hazard Control and Healthy Homes (OLHCHH), | more...

June 3, 2016

June Is National Home Ownership Month

By Joe Wallace

HUD announced National Home Ownership Month this week, and the entire month of June will include special efforts to raise awareness of how “homeownership enhances lives and contributes to thriving communities we call home” according to a HUD press release. ‘Dare to Own the Dream’ is the theme of this year’s campaign, “reinforcing the long-held belief that owning a home remains one of the cornerstones of the American Dream”. According to the press release, a lot of things have changed in the eight years of the Obama administration. “…the nations housing market was in free-fall, unemployment was rising and many families were left feeling trapped and anxious about their mortgages. He immediately took action to address these issues and to protect the middle class. The steps he took helped millions | more...

June 2, 2016

HUD Announces Housing Counseling Committee

By Joe Wallace

In many of our blog posts, we encourage borrowers to contact the FHA/HUD directly to seek a referral to a local, HUD-approved housing counselor. Pre-purchase counseling can be a very important part of the home loan application process, especially for borrowers who are new to the mortgage loan process. In some cases, as with FHA reverse mortgages/HECM loans, counseling is required as a condition of loan approval. Borrowers can contact the FHA/HUD directly to request housing counseling by calling 1-800 CALL FHA. And now, thanks to action by HUD in compliance with the Dodd-Frank Act of 2010, a new committee is looking into ways to expand and improve housing counseling. According to a press release at the HUD official site, on Wednesday June 1, 2016, “this advisory panel will help | more...