Articles Tagged With: Pre-approval

May 14, 2024

Why Get Pre-Approved For An FHA Home Loan?

Why get pre-approved for an FHA mortgage? This is a question some first-time home buyers ask, and the answers can make a big difference in how you approach your home loan. FHA Home Loan Pre-Approval Does Not Commit You To A Mortgage When you fill out the forms to be pre-approved for a home loan, you are not committing to the transaction in the sense that you would be financially obligated to buy. The borrower is not legally committed to a purchase when getting pre-approved. Home loan pre-approval actually helps you be taken seriously as a buyer when you do find a home you’re ready to commit to. The buyer takes a pre-approved borrower more seriously and you may find that a pre-approval letter (depending on the housing market) is | more...

February 15, 2024

Home Loans: When To Get Pre-Approved

By Joe Wallace

When should a house hunter choose to get pre-approved for a home loan? It’s a common question many borrowers ask. But this question can be confusing because some use the term “prequalify” interchangeably with “pre-approval”. But these two terms actually mean different things. Getting prequalified for a home loan is something you do early in the house-hunting stages. You are not ready to make any offers, but you want to let sellers know you are not window shopping. Prequalification means the borrower has filled out some basic paperwork with a lender while in house-hunting. It is not loan approval, and borrowers still, at this stage, have a ways to go before loan approval happens, including filling out basic loan application paperwork (not pre-qualification paperwork). Do You Always Need To Pre-Qualify? | more...

December 12, 2023

FHA Home Loan Mistakes To Avoid

By Joe Wallace

Many people have checklists to help them shop for a home, apply for a mortgage loan, and close the deal. But is your house-hunting checklist really complete without adding a list of mistakes to avoid? Steer clear of these common errors some home buyers make, and you will save yourself time and money. FHA Loan Mistakes: Not Getting Pre-Approved For A Home Loan If you get pre-approved for a home loan, the seller of the property you decide to buy (or the real estate agent, or both) will know you are a serious buyer. Those who are in the window shopping phase of their home loan process aren’t take as seriously by a seller or RE agent, and in some cases not having pre-approval may exclude you from looking at | more...

July 7, 2023

Signs You Are Not Ready To Apply For A Home Loan

By Joe Wallace

How does a first-time buyer know they are ready to apply for a home loan? There are some instances where a first-time borrower is definitely NOT ready, do you know what they are? You Don’t Know Your FICO Scores If you don’t know what your FICO scores are, you aren’t truly prepared to apply for a home loan. You need to know what the lender will know when she reviews your credit report. If you apply without knowing your scores, you risk wasting time and money. You Haven’t Reviewed Your Credit Report In The Last Months Leading Up To Your Credit Application If you don’t know what your loan officer will see when your credit report is pulled, you aren’t ready to apply for a loan. Evidence of identity theft, | more...

March 2, 2023

Myths About FHA Refinance Loans

By Bruce Reichstein

There are plenty of misconceptions about refinancing real estate. If you have a house you want to refinance, it’s good to learn what you can and cannot do with an FHA refinance loan before you start shopping around for a lender. And you WILL want to shop around. FHA Refinance Loan Myths: You Have To Keep Your Original Lender You can refinance your home with another lender offering more competitive terms, rates, or perks for borrowing with that financial institution. FHA Refi Loan Myths: You Have To Refinance Into A Fixed-Rate Mortgage Borrowers can choose an FHA Adjustable Rate Mortgage (ARM) at refinance time if the lender offers such a loan. Not all participating lenders will, which is another reason to shop for the right lender. Refinancing an ARM into | more...

August 25, 2021

Home Loan Advice From TransUnion

By Joe Wallace

Credit issues are among the biggest worries for many FHA loan applicants. Are you concerned that you aren’t fully prepared for a home loan application? If you tackle home loan issues early enough, you can get much closer to home loan approval. We regularly encourage readers to check their credit scores, read and monitor their credit reports, and be extra-vigilant about checking those credit reports all the way until the loan closes. One of the reasons why we do that? Your lender will not check your credit ONCE during the home loan process–your credit may be reviewed multiple times. And that is one very good reason to keep checking your credit reports, too. And while we’re talking about credit reports, why not take some advice from the very agencies responsible | more...

August 3, 2021

Before You Apply For Mortgage Pre-Approval

By Joe Wallace

A lot of people assume they are ready to apply for any major line of credit at any time. But if you want to apply for mortgage pre-approval, there are some important things you need to ask yourself to determine whether you are truly ready to apply. Where are you at in the current process of planning and saving for a home loan? FHA mortgages, conventional loans, and even some first-time homebuyer downpayment assistance plans require the borrower to make a minimum investment. If you don’t have a down payment saved or have a plan to come up with your down payment and closing costs before seeking a lender, you may not be ready to apply for pre-approval. But what else should you be asking? One of the first things | more...

January 11, 2021

FHA Mortgage Rates In Early 2021

By Joe Wallace

All eyes are on 2021 and what the new year could bring for housing markets, including what might happen with mortgage loan interest rates. FHA loans and other government-backed home loans saw sub-three-percent mortgage loan interest rates in 2020, and the earliest days of 2021 those rates did not rise above three percent. Mortgage rates for FHA home loans including FHA One-Time Close construction loans, FHA Rehab loans, and others remain below the three percent line (assuming ideal conditions including a well-qualified borrower) where they sat, more or less, for a significant amount of time in years past. American political chaos, the coronavirus pandemic, economic uncertainty, nervous investors, and other variables have all worked together to keep mortgage loan interest rates below three percent for the time being. Did the | more...

December 22, 2020

FHA Mortgage Relief Extended Into 2021

By Joe Wallace

Millions of homeowners with FHA mortgages in need of mortgage relief during the coronavirus pandemic are getting an extension on their options to avoid foreclosure. That is thanks to a recent move by the Department of Housing and Urban Development; the agency has announced an extension to coronavirus relief measures intended to help borrowers financially affected by COVID-19. FHA and HUD official sites announced this week that they have approved a two-month extension to the COVID-19 related foreclosure and eviction moratorium. The new expiration date for the moratorium is listed as February 28, 2021. There is now more time for FHA borrowers to request what the FHA calls an “initial COVID-19 forbearance” which must be obtained from the borrower’s mortgage servicer. This forbearance is meant to “defer or reduce” FHA | more...

December 16, 2020

FHA Construction Loan Rule Changes In 2021

By Joe Wallace

The FHA One-Time Close construction loan, also known as a construction-to-permanent mortgage or simply as a home construction loan, is an option for home buyers who want to build a home from the ground up. There are USDA versions of this type of loan (with income caps and other need-based restrictions), there’s a VA One-Time Close loan for qualifying military personnel, and there is also the FHA One-Time Close construction loan which features a low 3.5% down payment the same as all other FHA purchase loan options. The FHA and HUD have announced changes to the FHA One-Time Close program in 2021. These changes will formalize certain elements of the program, and change others as we’ll see below. HUD has changed its maximum financing policy and other requirements for New | more...