FHA loans in the last 12 months have become one of the most used types of mortgages. There could be several reasons for this......
- less money down - 3.5% down
- lower credit scores - anywhere from 600 down to 550.
- less than perfect credit
- no credit at all
- 2 years out of a bankruptcy
Well, things have been changing. No, HUD hasn't really been changing the FHA guidelines, but the investors and banks have been changing them. We are in a credit crunch crisis. Just in the last few months, I have been getting a few calls and e-mails from people telling me that HUD's website says this or that. I have actually had a few people argue with me a little, because of what it's says on HUD's website. Just a word to the wise, FHA doesn't do the mortgages. They don't service them, they just insure them. It all comes down to the investors and those that sell back to Wall Street.
Now, I will admit, you can't believe everything that you read or hear. There was a rumor going around that credit scores were going to be mandatory across that board at 620 and above. This is incorrect. But you should be aware that this could happen. I just had a realtor e-mail me from Florida today, telling me that her Countrywide rep. told her that her son would have to wait another full year for a FHA mortgage even though his Ch. 7 bankruptcy will be discharged for 2 years in April of 2009. He has saved his cash, reestablished his credit, and has credit scores of 680. This actually sounds like one of my easier deals.
Conclusion - You really need to be choosing your loan officer very wisely now. Someone that is on top of these changes daily, not monthly. FHA loans do differ from lender to lender. In some cases, if it sounds too goo to be true, then it might not be true. If your lender is taking over 30 days to get a FHA mortgage approved, you might want to seek someone else. And keep in mind, just because it's on HUD's website, doesn't mean that it can be done anymore. Investors and lenders need to make sure that the loan is sell-able on Wall Street.
Disclosure - One comment that seems to pop up that does irritate me. FHA loans don't take forever. A very good loan officer and company can do them in 2 weeks. But many of us like to have 30 days to process them. But they don't take 45 days or longer, not unless they have a credit issue, need to get their credit score up, or might be waiting for a raise. And if your loan officer was good, they would have discussed this with you. It's called setting your clients expectations to a certain level. Please read : Are your expectations met as a client or a realtor?
- FHA Loans - USDA Loans - VA Loans -
- Energy Efficient Mortgages -
- Conventional Loans - 203 k loans -
- Mortgages -
Experience & Knowledge at its BEST !!!
For more information on FHA loans, please go to this link. The FHA Expert
For more information about the 2008-2009 Tax Credit for First Time Homebuyers : 2008 Tax Credit
For important mortgage insight to watch for, please read : Consumers need to be aware of these Red Flags !!!!
Copyright © 2009 by Jeff Belonger