Fhamortgageloan's Blog

advantages of fha loans over conventional loans

fhamortgageloan — Wed, 15 Jul 2009 11:35:30 +0000

FHA loans have many benefits when compared to conventional loans. There are many benefits for the borrower and also for the lender as FHA loans are less riskier for the lenders as the loans are insured by FHA.

Down Payment: For FHA loans only 3% down payment is required, while for a conventional loan minimum of 5% down payment is required and it can go up to 15%.

Credit Scores: For conventional loans you require perfect credit scores while credit score is not an issue if you are applying for a FHA loan.

Monthly Mortgage payments: It is less in FHA loans as compared to conventional loans.

Property standards: FHA has certain property standards while conventional loans don’t have any property standards. FHA Homes should be inspected properly and should be perfect for living.

Also, you can apply for a FHA mortgage loan after two years in case of a foreclosure and after three years in case of a bankruptcy.

Benefits of FHA streamline refinance

fhamortgageloan — Tue, 14 Jul 2009 10:29:42 +0000

FHA streamline refinance as far is considered as the best mortgage program that is provided by FHA. Some benefits of FHA streamline refinance are:

FHA streamline refinance does not require any income verification. You don’t have to worry about your income even it has dropped, you can still qualify and can utilize the lower FHA rates.

Also, FHA streamline refinance does not require any assets verification. You don’t have to provide your assets or any reserves to qualify for the program.

FHA streamline refinance does not require an appraisal. Most people are not able to qualify because there home have low value or value of there home is decreased but it is not the issue in case of FHA refinance.

As no appraisal or any other verification are required these loans can be wrapped up quickly. If you have qualified for FHA loan, then the qualification is carried on to FHA streamline refinance.

FHA home loans – common myths

fhamortgageloan — Mon, 13 Jul 2009 11:02:56 +0000

Myth # 1 – Government loans the money

Most common myth about FHA loan is that the loan is provided by the Federal Housing Administration (FHA) which is not the case. Government only guarantees for your loan and because of this guarantee, these loans are less riskier for the lenders or banks.

Myth # 2 – FHA loan takes longer to get approved

FHA home loans take no longer than other conventional home loans if you are properly guided by FHA loan officer who understands FHA mortgages completely.

Myth # 3 – Credit Score doesn’t matter

This is neither completely true neither completely false. You must have a strong credit history for the past 12 months or so. You should have made all your payments on time without any delay. FHA may also look at your phone bills, rent and other bills to know credit worthiness

FHA appraisal

fhamortgageloan — Fri, 10 Jul 2009 08:35:44 +0000

FHA appraisal is a critical component of an FHA mortgage to determine the market value of the home. This market value serves the basis for the maximum FHA insured mortgage loan. FHA appraisal is done for the benefit of the lender and HUD and apart from determining the home value, it als0 provides an examination of the property for any defect that can be harmful for the people living in the house.

FHA appraisers are required to repair or replace anything that affects the safe habitation of the house. FHA appraisers are required to make a complete inspection of the home, both from inside and also from outside. FHA appraisers must ensure that each and every thing is perfect may be its hand-rails, windows, smoke detectors, condition of the roofs and the kitchen. They must check whether all the components are working properly or not.

FHA appraisal determines the accurate value of the home to be financed which minimizes the risk of the lender because if the borrower defaults on the loan, then the home will provide the means of recovery for the lender. HUD requires appraisals for all FHA insured mortgages. FHA does not take guarantee that the home is in perfect condition but it ensures that the home is in safe and secure condition. Also, the home must meet all the FHA requirements.

How to secure FHA home loan?

fhamortgageloan — Wed, 08 Jul 2009 10:44:09 +0000

There are certain factors that you must keep in mind to secure your FHA home loan. Below are some simple tips on how you can secure your FHA insured mortgage.

Credit score is the most important factor. You must clear your previous debts and should increase your credit score before going for the mortgage

You should do a good market research before buying a home. you should understand FHA home loans processing and pros and cons of FHA insured mortgages.

You must completely understand the procedure of the FHA loan processing and also pros and cons of the market before applying for the loan.

You should not borrow more than that you can pay off. You should limit yourself and also should buy a home that you can afford.

You can take help of FHA approved lenders or advice from experts on how to go for a FHA home loan and securing the loan.

FHA loan guidelines

fhamortgageloan — Tue, 07 Jul 2009 08:51:22 +0000

There are certain guidelines that should be followed when you apply for FHA home loan. Your mortgage payment (principal, interest, taxes) should be not more than 31% of your gross salary. Also your monthly debt obligation should be not more than 43% of your income (including mortgage). You must send your file to an underwriter after putting all the necessary information and providing complete documents. An underwriter is a person who reviews your FHA loan file and decides whether you are eligible for the mortgage loan or not.

SOME OF THE IMPORTANT THAT MUST BE INCLUDE IN THE FILE ARE:

Social Security Number
Address of your residences for the past two years
Information of your employer for the past two year
Current gross income
Complete information about your bank accounts
Detail of any property you owe.
estimated value of the home.

FHA closing cost

fhamortgageloan — Mon, 06 Jul 2009 10:03:31 +0000

When you buy a home, you must consider about closing cost. These cost are allowable and are necessary for the borrower. FHA allows you to finance your closing cost in your FHA loan. Following fees and closing cost can also be included in your FHA mortgage

Appraisal fees
Home inspection fees
Lender’s origination fees
Cost of credit reports
Deposit verification fees
Title examination and insurance cost
Attorney’s fees
Property survey fees
Recording fees and taxes

ADVANTAGES OF JUMBO MORTGAGES

fhamortgageloan — Thu, 02 Jul 2009 09:28:33 +0000

Jumbo mortgages are loans in which amount provided is above maximum loan amount fixed by federal government. Expensive home costs make people to apply for jumbo mortgages. If you want to buy a home whose value is much more than the maximum loan amount of that county then Jumbo mortgages helps you to buy that home. You cannot afford to pay the full amount in cash. There are no restrictions on the use of money obtained from Jumbo Mortgage and you are free to use the money any way you want.

Even interest rates are higher for jumbo mortgages, then also you don’t have to pay any taxes on the interest so you can save considerable amount of money. These loans are becoming affordable as lenders are providing these loans on low interest rates considering the expensive real estate.

Jumbo Loans

fhamortgageloan — Mon, 29 Jun 2009 05:48:55 +0000

Jumbo loans are above the maximum loan amount set by Freddie Mac and Fannie Mae. They have a little higher rate than conforming. Jumbo loans are securitized by other institutes than Freddie Mac and Fannie Mae. Jumbo loans are proves to be more riskier to lenders because as the loan limits are very high and if the borrower defaults on the payment, it will be difficult for the lenders to sell luxury homes at high prices.

Due to high risk associated with Jumbo loans, lenders prefer higher down payment from the borrowers. Interest rates charged on a jumbo loan is usually higher than a loan that is conforming. Refinancing a jumbo loan can be costly due to high closing cost. You should seek advice from different authorized lenders about jumbo loans, before applying for it.

FHA loan processing

fhamortgageloan — Fri, 26 Jun 2009 05:56:23 +0000

Processing of your FHA loan file is the most important part of your loan process. Before FHA investors process your file, you must review your file from a certified FHA lender. If some documents are missing or some original documents are needed then this is the time to complete the file.

Verification of employment- your form is sent to your employers to verify your income and your job.

Verification of savings- form is sent to your bank verifying your account balances for the past 3 months.

Appraisal- order will be from a FHA approved appraiser. The appraiser will go to the property and check for FHA requirements, size of the property, and will determine the value of the home.

Additional Documents- Additional documents may be needed depending on your case scenario. It depends on the individual.