Articles Tagged With: Monthly Payment

September 28, 2016

FHA Loan Mortgage Insurance Premiums

Here’s a version of a common question we’ve been asked recently about FHA mortgage insurance premiums: “I closed an FHA mortgage on a house I purchased in December 2014. The following month FHA reduced the mortgage insurance premium (MIP). Can I get the lower mortgage insurance rate and a reduced monthly payment without totally refinancing my mortgage?” The FHA/HUD official site published a .pdf file that addresses this question directly. Back in 2015 the FHA lowered it’s mortgage insurance premium. The pdf states, “The reduction is effective as of January 26, 2015. Borrowers with case numbers assigned on and after January 26, 2015 will be eligible for reduced annual mortgage insurance premiums.” Note the specific date when the lower premiums become effective-borrowers who have loans prior to these dates will | more...

September 2, 2016

Foreclosure Avoidance on FHA Mortgages: The Trial Payment Plan

By Joe Wallace

The FHA recently announced changes to its policies designed to help those who purchased homes with FHA mortgages and have since fallen into financial trouble to avoid foreclosure. There are many government programs to help borrowers keep their homes in hard times including the Obama mortgage, and the FHA Home Affordable Modification Program or HAMP. If you have fallen behind on your mortgage payments on an FHA mortgage, the information here will be of special interest to you. Those who are under consideration for HAMP may learn they have to complete a trial payment plan before the HAMP modification can be finalized and approved. But what does this trial payment plan (also referred to as TPP) entail? The FHA announced modifications to the HAMP program this summer, and in FHA | more...

September 1, 2016

FHA Loan Reader Questions: Judgments and Loan Approval

By Joe Wallace

A reader asks, “I have a judgment for a car that was repossessed in May 2010. It was a car purchased by my husband with myself as cosigner. I didnt plan on paying it off as we are waiting on a divorce and he has no plans to help pay it off. Will I be able to get a FHA mortgage with this lingering on my credit? I do have credit scores in the 650 range and higher.” Community property laws in a given state, where applicable, may affect the answer to this question, but in general, FHA loan rules in HUD 4000.1 state that judgments on a borrower’s credit history must have some kind of resolution. On pages 177 and 178 of HUD 4000.1 we learn a great deal | more...

August 31, 2016

FHA Loan Debt To Income Ratio Rules: Student Loans

By Joe Wallace

When the lender is adding up an FHA loan applicant’s income and monthly financial obligations for the purpose of calculating debt ratios, there are some debts that can be more complicated than others. Student loans, for example, can be tricky because a borrower may have student loan debt that is in “deferred” status, while others may be paying on their loans at the time of the loan application or soon thereafter. Here’s a recent reader question on the subject: “I cannot find anything that talks about NON deferred student loans. I have a client with a $63 payment on their credit report ($25,000 student loan balance). The loan is NOT in deferment, he pays $63 per month. The u/w is telling me I must use the greater of 1% of | more...

Buying A Fixer-Upper With An FHA 203(k) Rehab Loan

August 30, 2016

FHA Loans and Foreclosure Avoidance: The FHA HAMP Loan

By Joe Wallace

When you purchase your home with an FHA mortgage loan, chances are you’re thinking more about moving in, getting settled, and making the home your own than you are the possibility that you could encounter financial hardship at some point and miss mortgage payments. But these things do happen to some borrowers, and the FHA has a program set up to help those who get into financial trouble. The FHA HAMP program was created to help borrowers avoid foreclosure and keep them in the home. FHA HAMP is a loan modification program and not a refinance loan, which is an important distinction to make. Under the terms of the FHA HAMP program, the FHA permits ” the use of a partial claim up to 30 percent of the unpaid principal | more...

August 4, 2016

FHA Loan Rules: Special Forbearance For Unemployed Home Owners

By Joe Wallace

When a borrower applies for an FHA mortgage, experiencing financial trouble isn’t top-of-mind; qualifying for the loan, making the down payment, and moving in are likely the big issues most think about when applying. But financial difficulties can and sometimes do come, so what can a borrower do if he or she finds themselves unemployed after purchasing a home with an FHA mortgage? FHA loan rules in HUD 4000.1 do permit the lender to offer something known as “special forbearance” or SFB for unemployed borrowers who are in danger of missing payments, going into loan default, etc. “The SFB-Unemployment Agreement is a written agreement between a Mortgagee and the Borrowers, one or more of whom has become unemployed, allowing for reduced and/or suspended Mortgage Payments.” This is an arrangement negotiated | 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 7, 2016

FHA Loan Terms

By Joe Wallace

Understanding Your Loan Term from FHA.com on Vimeo. How long is an FHA mortgage? The answer to that question depends on a variety of factors including the initial choice of fixed or adjustable rate mortgage, whether you plan to pay off the loan early or not, whether you plan to refinance, etc. The typical length of a fixed rate, new purchase FHA mortgage can be 15 or 30 years. If you are refinancing, other variables may apply. Choosing a loan term depends on the individual borrower’s specific needs and goals. You may wish to apply for a 15-year mortgage if you are interested in saving money over the lifetime of the loan; borrowers who choose 15-year mortgages will make higher monthly payments than those who choose 30-year loans, but the | more...

Can I buy a manufactured home with an FHA loan?

June 22, 2016

Are You Ready For An FHA Mortgage?

By Joe Wallace

A recent CNN Money article reveals that more than 10 million Americans spend half their income on rent. It’s a figure (based on a 2014 study at Harvard) that is surprising to some, and motivating for others. Are you considering an FHA mortgage as an alternative to high rents? FHA home loans have features that can be very helpful to those in the market for a new home. Consider the down payment requirement for an FHA mortgage compared to many conventional loans and it’s easy to see that the FHA’s 3.5% down payment requirement compared to between 10% and 20% down for conventional mortgages depending on the lender and the borrower’s financial qualifications. The lower down payment is one factor; another is the borrower’s ability to refinance an FHA mortgage | more...

May 26, 2016

FHA Refinance Loans: What You Should Know Before Applying

By Joe Wallace

Not all refinance loans are created equal, and not all FHA refinance loans have the same terms and conditions. Did you know that FHA refinance loans will, depending on the participating lender, allow you to refinance an adjustable rate mortgage (ARM) into a fixed rate but also may permit you to go from one adjustable rate mortgage to a new ARM loan? Qualified borrowers have a variety of refinance options open to them when it comes to rates, loan term, and related concerns. There are many things to consider when refinancing with an FHA mortgage. For example, you do not have to use your existing lender to refinance. You may shop around for a new lender to refinance your mortgage loan with. You are also not required to have an | more...