FHA and Non-Occupying Co-Signors

February 28, 2012 By Leave a Comment

FHA has a unique qualification / underwriting guideline, that allows you to purchase a home, with a relative that does not live in the house… “The FHA Non-Occupying Co-Signor Program”  is sometimes, referred to in the Mortgage Industry as a “Kiddie Condo,”  because frankly it’s perfect for purchasing a house for kids in college! 

Instead of renting a dorm, many NC parents put the student on the mortgage loan and purchase a house, splitting the rent with others!  We also use this program for 55+ adults who having aging parents who can not, for whatever reason, qualify to purchase a home – and the child helps the parent qualify for a mortgage loan.

Quite often First Time Homebuyers have a need for someone else to be on a mortgage with them in order to qualify to purchase a home.   Additionally, we see situations where onespouse has a credit issue, and while the other spouse has great credit scores (maybe one had a foreclosure or short sale), they can’t qualify for the new house on their single income.  In each of these cases, we refer clients to the FHA mortgage loan program, because of it’s common sense underwriting approach. [Read more...]

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Filed Under: FHA Mortgage Loans

The Different Kinds of Mortgage Insurance

February 1, 2012 By Leave a Comment

New House PMIMost folks want to avoid PMI… but they don’t realize that they are happily paying a “kind” of mortgage insurance no matter what kind of loan they are getting!

Mortgage Insurance is not the insurance that covers you if you die, or are disabled and can not pay the mortgage… it’s the insurance that protects the BANK in the event you go into foreclosure.

Given the recent UP TICK in foreclosures, you can see why banks are requiring higher coverage amounts!  If you are applying for a Conventional mortgage, and you are putting more then 20% on a property you plan to live in, you avoid this additional insurance… [Read more...]

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Calculating FHA Downpayment

January 30, 2012 By Leave a Comment

Be CarefulI’ve been in this business for a while… my daughter would tell you I’m old as dirt… and for as long as I’ve been in this, we’ve had a complicated way of calculating FHA Downpayment.

FHA always used acquisition cost.  How much were you putting into the total aquisition of the property… closing costs and downpayment combined.

With the new rule changes of January 1… we use a STRAIGHT UP number.  The base loan will be a 96.5% of the sales price or appraised value – whichever is LESS.  If you are working with a loan officer is is unfamiliar with FHA – you could find yourself at the closing table wishing you’d done a little more research. I just saw a deal where the loan officer quoted the wrong downpayment amount by $1200. [Read more...]

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Can You Refinance To The Lowest Mortgage Rate?

January 1, 2012 By 7 Comments

refinance to low mortgage ratesMortgage Interest Rates are at ALL TIME lows, and many of the people calling us want to know if it’s even possible to Refinance these days!

The answer is maybe.  If you are looking for a “rate term” meaning no cash out – and you haven’t missed any mortgage payments in the last 12 months and you think you have at least a 600 credit score - call me.  We can possibly figure this out.  There are some cool guideline changes coming out between now and the beginning of March 2012 that don’t have any “Loan To Value” requirements for refinances!

If you are getting a divorce – and you have never worked, and you need to use the alimony your spouse is SUPPOSE to start paying you in September to qualify for a home… well, call me… because we need to talk about how this is going to work and what documentation we are going to need. [Read more...]

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Filed Under: credit, FHA Mortgage Loans Tagged With: , , , , ,

FHA Seller Repairs Required

December 13, 2011 By Leave a Comment

If you are interesbuying a foreclosed home in ncted in purchasing a distressed home, or one that’s been foreclosed upon, it probably has some “deferred maintenance items” that need to be done.  Getting the Seller to DO those items, however, is normally difficult.  So the question becomes, what will FHA let you leave undone, while still giving you an FHA Loan on the home.

Here’s what we’re seeing with some “unique” foreclosed Bank Owned Properties and  “handyman specials” in December of 2011.

Un-permitted Improvements: 

In the last year or two, we’ve seen a couple of situations where a Seller has finished off a bonus room, upstairs, or converted a garage into a living space.  If this was not properly inspected and permitted, that space will not be calculated in the value of the property.  Sometimes, non-permitted additions and remodels are not completed to code.  For instance, if the garage conversion doesn’t have adequate heat or insulation, the FHA appraiser / underwriter may require that these items be brought to code. [Read more...]

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Qualifying For A FHA Streamline Refinance

December 13, 2011 By 2 Comments

FHA Streamline refinanceFHA changed it’s guidelines so that VERY little is required to qualify, however, in North Carolina, we have our own State mandated standards, so again – many of the NC Banks can not offer this program the way FHA intended for it to work – WE DO!

FHA says that to qualify:

  • Employment verification is not required with an FHA Streamline Refinance
  • Income verification is not required with an FHA Streamline Refinance
  • Credit score verification is not required with an FHA Streamline Refinance* (See notes below regarding AUS findings)
  • A new appraisal is not required with an FHA Streamline Refinance


[Read more...]

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Refinance Options For FHA Mortgages

December 12, 2011 By 1 Comment

fha refinanceIf you currently have an FHA Mortgage, we might want to peak and see if you’re eligible for an FHA Streamline Refinance.  This is a great program, that differs GREATLY from other mortgage programs!  Under the updated FHA guidelines, you can refinance to lower payments with No Income Verification, No Appraisal… it’s pretty simple!

The FHA Streamline Refinance program is only available to folks who currently have an FHA home loan mortgage.  Even if you are not currently occupying the property, we MIGHT be able to do a Streamline refinance!  This is not a program designed for those who want to take equity out of their home, only for those who currently have an FHA mortgage on their home, and want a lower mortgage rate!  It’s one of the easiest, fastest ways to get your payments down!

One of the biggest differences between the FHA Streamline Refinance, and a VA Streamline Refinance (or a USDA Refinance for that matter) is that the program does not require an updated home appraisal. [Read more...]

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FHA Repair Requirements 2011 in North Carolina

December 8, 2011 By Leave a Comment

needs to be fixedFHA Mortgage Underwriting Requirements for repairs are really quite different than they were several years ago, before there were so many foreclosed and distressed homes on the market in North Carolina.  In 2011,  FHA Home Loan Financing is one of the most popular programs available, because it is “forgiving” to folks who have had some credit challenges, it only requires a 3.5% down payment, the downpayment can be a gift, and you can purchase the property with a non-occupying co-borrower (a family member).

At the same time, Home Buyers are looking for a great deal – and this often means that they are looking for properties that are foreclosed, bank owned, short sales or… in other words have some “DIY” repair opportunites that need to be made. 

The question becomes, what repairs will FHA Guidelines require be done BEFORE closing, and which items can the home buyer do once they have ownership? [Read more...]

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How to Write a Contract With A DAP

November 24, 2011 By Leave a Comment

First off – A DAP is the “mortgage babble term” for DownPayment Assistance Programs.  These programs USE to be funded by a SELLER paid contribution – these days, however, “the Home seller can only help buyers pay closing costs by giving a portion of their proceeds back to the buyer at closing, in the form of closing costs. The amount of seller assistance that’s allowed depends on the type of loan the buyer is getting.”

Post “housing Meltdown” there are now many laws, guidelines and regulations on the books regarding WHAT a Seller can “give” a Buyer – and what they are not allowed to give.  Sellers are no longer allowed to give home buyers down payment funds. In fact, there are many situations where the Seller is very limited to what they can even pay towards closing costs!

But All Is Not Lost! There’s STILL A Down Payment Assistance Program Available, With over $8,000 in FREE $$! [Read more...]

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Filed Under: FHA Mortgage Loans, First Time Home Buyer Tagged With: , , , , , , ,

Single Parents CAN Buy A Home in North Carolina!

November 22, 2011 By Leave a Comment

Mom Can Buy A Home!With the Economy in a “slump” statistics show more and more families have a single parent.  If you are in this situation, and want to purchase a home, there are some very specific details you should know:

  • FHA requires a 3.5% Investment into the Property, which is lower than the 5% charged on most Conventional Loans.

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