How many of you know there comes a time when your house will need some improvement? Of course this might not happen for a few years if you recently purchased a house that had to be built from the ground up. But, if you purchased an existing home that was already several years old, there could be a need for home improvement. Have you ever thought about how you were going to pay for these home improvements? I have to admit I am not into remodeling and painting and things of that nature. I am not one of those people that sit and watch all the home shows that come on television even though my husband is quite the fan. As a matter of fact, our twins even love watching these shows. Kudos to them for learning at a very early age what they like and dislike in the way of fashion and home decoration.

Even as I write this, they are fans of going to model homes and looking at the different layouts, floor plans and color schemes. If you are into that then remodeling and upgrading your home is ideal. I imagine you would already have an idea of how you would pay for it. If you had no idea, FHA has a home improvement loan. You have to see this because this could be an answer to your prayers. The Federal Housing Administration (FHA) allows loans up to $25,000 without any equity in the home. The loan can exceed the value of the home. Before you run right out and do this, read the entire blog. There is more to this and I don’t want you to miss anything.

I did some research to find out more about the home improvement loan. I found out that the Title I program insures loans to finance the light or moderate rehabilitation of properties, as well as the construction of nonresidential buildings on the property. That means you cannot do a complete overhaul of your house. That says to me you cannot tear the house down and start over from scratch. In my opinion, this would be along the lines of potentially finishing a basement or have air conditioning put in your home. Those are light to moderate adjustments to the property. Furthermore, this particular program may be used to insure such loans for up to 20 years on either single or multi-family properties. Remember that did not say you would get $25,000 but it said up to that amount.

I was happy to find out these are fixed- rate loans, especially after all the stories on foreclosures. It seems the picture is becoming very bleak as you read the local news or watch national news on television regarding the housing industry. For that reason alone it is very important that you continue reading all the information you can about housing, loans and current news. I do not believe you can ever have too much information, although you can be in a place where you have not received enough. Most of the time when that happens it is to your detriment and not your benefit. So I recommend strongly that you slow down, read all the information you can get your hands on and plan for a successful financial housing experience.

Taffy Wagner

I am always happy to see information that I was not aware of when it comes to mortgages. The more I find out, the more I will share with you so you can remain an informed consumer make the appropriate decision. Today I am going to discuss several different types of loans. The particular loan I am going to start with today has to do with Energy Efficient Mortgage. Not to say that I was surprised; however, I felt people arranged for energy efficient assistance once their utility bill became unmanageable.

Glad to say that I was wrong. That is not always the case sure it does happen but not always the reason for an energy efficient mortgage. The Energy Efficient Mortgage allows a homebuyer to save future money on utility bills. I am not saying whether I recommend or do not recommend but read all the details below and you decide.

With an Energy Efficient Mortgage you can finance the cost of adding energy-efficient features to a new or existing home as part of an FHA-insured home purchase. I would have to even ask you at this point is this an option you could consider? The Energy Efficient Mortgage can be used with both 203(b) and 203(k) loans. As you know, with all loans there are requirements you must meet before you can be approved for this type of loan

Basic guidelines are:

• Cost of improvements must be determined by a Home Energy Rating System or by an energy consultant. Very sensible this cost must be less than the anticipated savings from the improvements.
• One- and two-unit new or existing homes are eligible; condos are not. For those people that like to purchase condos – look at the advantages and disadvantages to purchasing and living in a condo.
• The improvements finances may be 5% of property value or $4,000 whichever is greater. The total must fall within the FHA loan limit. You do not want to exceed the FHA loan limit.

Before you start with any loan paperwork or visiting the property, be sure that you have sat down and written out all of your questions regarding this property. Even if you think it is a sill question. The only limiting question is the one that doesn’t get answered.

The second type of loan

I must admit, I have not ever heard of this type of loan. If someone has heard of the next type of loan, shoot me an email and share your experience with this type of loan.

Are all the couples or brides ready that are reading this blog? Here is one that you might not have even heard before — the Bridal Registry. I saw the wheels in your mind turning and you are right, you may register at a department store for wedding gifts. The Bridal Registry program allows couples to register with a lender and open up an interest-bearing account family and friends can deposit weddings gifts of cash into the account. I think this is a marvelous idea for those who plan to purchase a house in the future. Seems to me this might give you a head start over others that didn’t do it.

How many bride and grooms do you know that will run right out and sign up? I am not sure but want to make sure they know it is available. Ask your lender for complete details.

Dr. Taffy Wagner

FHA Home Loans have many options that anyone can consider. The purpose of writing on this particular topic is to share with you what is available. I was not aware of all the different types of loans that FHA had to offer. Sure you will know about some of the ones that I talk about it, but there might be others that fit your situation better. So before you run right out and say you want a specific type of loan, read this thoroughly. Do additional research if necessary and choose what works best for you.

I heard you guys say, you are always saying research, research – couldn’t I have done enough research by now. Not necessarily and research aids in making informed decisions versus impulse decisions which lead to error, owning the American nightmare versus dream and even imposed tension in a marriage because someone did not research thoroughly before signing on the dotted line. I can’t tell you how many times I have heard that and have even witnessed something happening once or twice in my own marriage because all the information was not received up front. Don’t leave it up to the mortgage banker, broker or realtor to give you all the information. Do your own homework and research. At the end of the day, you are responsible for the mortgage payments and all that is involved with home ownership.

Let’s get to the different types of loans which I am going to talk about over two or three days. If it takes two days to cover it, then that is what it will take; otherwise it will be three. First we have the FHA 203(b) Loan – from what I read it is the most commonly used, offers a low down payment, flexible qualifying guidelines, limited lender’s fees and a maximum loan amount.

I believe one of the biggest benefits of any loan is having a loan with a low down payment. If you have a low down payment that alleviates more of a pressure of attempting to manage a higher down payment when you know you don’t have the money. When I was reading about this loan, it said this loan enables the homebuyer to finance both the purchase and rehabilitation of a home through a single mortgage. This meaning it is divided with a portion being used to pay off the seller’s existing mortgage and the remaining is placed in an escrow account and released as rehabilitation is completed.

Correct me if I am wrong, if it has to be rehabilitated isn’t it a pre-existing foundation? I would believe if it wasn’t pre-existing that this type of loan would then not be available for this particular buyer and the buyer would have to begin his or her search all over again. Definitely send me some comments on this, help my understanding of the 203(b). I am always looking for information that I believe has not been shared on a larger scale to share with my readers.

We have discussed the 203(b) – send me your comments and thoughts about this type of loan. Even if you have had this type of loan, what do you think the benefits are or what is the downside?

Dr. Taffy Wagner

Now that you have read the initial qualifications of the FHA reverse mortgage, before you get in your car and drive to your loan officer’s office or call on the telephone let’s finish discussing all the pertinent details about FHA Reverse Mortgage. Wouldn’t you be embarrassed if you went at this stage and they asked you several different things that would be revealed later in this blog that eliminated you from qualifying? It’s very important that you always get all of the details before acting too fast. That’s a tip for any area of your life, not just mortgages.

From the different stories that I read several months ago, I could never ascertain what types of homes were available for a FHA Reverse Mortgage so I am going to elaborate on that. Homes must be a single family dwelling or a two-to-four unit property that you own and occupy. It appears that you have to own the home and live there, not just own the home. Townhouses, detached homes, units in condominiums and some manufactured homes are eligible. This is another area where you want to verify with the HUD- approved counseling if your residence would be available depending upon the type of dwelling. This leads me to believe all types of homes don’t qualify.

Since we know this type of loan is for elderly adults, seniors if you will a concern that I had was would they be actually leaving a bill to their surviving children, especially if the home was not paid off. Remember an elderly person 62 years of age or older can receive a FHA Reverse mortgage. This is what happens, when the homeowner sells his or her home or no longer use it for their primary residence. They will have to repay the cash received from the reverse mortgage, plus interest and other fees to the lender. The remaining equity in the home, if any belongs to the owner or their heirs. None of the assets will be affected by HUD’s reverse mortgage loan. Additionally, which I believe is great and was a concern of mine was if the debt could be passed along to the estate or heirs and fortunately it cannot.

I would like to point out a concern that came to my mind. Wouldn’t one of the reasons an elderly person potentially takes a reverse mortgage would be to help with additional medical bills or something of that nature? I say this because if the homeowner sells his or her property and no longer use it as their primary residence, they are now going to be hit with all these different financial obligations that they might not have planned on. Of course that means, prior to getting this type of loan you must ensure you are able to manage it, including if you sell your primary residence. Do not take on more than you can handle or you will be miserable.

Maybe you are a reader and wondering if you can still apply for a FHA reverse mortgage if you current loan is not an FHA loan. From what I read on the Department of Housing and Urban Development you don’t have to because your new reverse loan will be a FHA-ensured loan.

What do you think of FHA Reverse Mortgages now that you have all this information?

Taffy Wagner

I have read different stories about a reverse mortgage and thought it was time I found out truly what a reverse mortgage is, who qualifies and what is needed for them to get a FHA Reverse Mortgage. I have heard good stories and bad stories, so I felt this was one of those items that should be discussed.

According to U.S. Department of Housing and Urban Development, a reverse mortgage is a special type of home loan that lets a homeowner converts a portion of the equity in his or her home into cash. Before you think right away that you can run right out and get a reverse mortgage, keep reading. You might not even qualify.Unlike a traditional home equity or second mortgage, no repayment is required until the borrower(s) no longer use the home as their principal residence. HUD’s reverse mortgage provides these benefits and it is federally-insured as well. I know you are thinking great, can I go and apply now. Not just yet.

As you know with every loan whether it is a reverse mortgage loan or even a traditional loan, there are specific requirements you must meet in order to qualify for a loan. The first requirement for a HUD reverse mortgage loan is HUD’s Federal Housing Administration (FHA) requires (sounds non-negotiable to me) that the borrower is a homeowner, 62 years of age or older; own your home outright or have a low mortgage balance that can be paid off at the closing with proceeds from the reverse loan and you must live in the home.

I know that was a mouth full so let’s break it down. First, the borrower must be 62 years or age or older. If you are not this age or older, you do not qualify for a HUD reverse mortgage. I would say move on to find other options for your particular situation. Second, you have to own your home outright or have a low mortgage balance that can be paid off at the closing with proceeds from the reverse loan. Does this make sense at this point? Third, you must live in the home. Fourth requirement which notice I did not say optional is that you receive consumer information from HUD-approved counseling sources prior to obtaining the loan.

I am a firm believer in education and knowledge in order to make informed decisions. Therefore, you should not go wrong with the consumer information from a HUD-approved counseling. Make sure you have studied this loan and have questions to ask the counselor. Do not go to this meeting empty-handed and unprepared.

If you are unsure where to find HUD approved counselors in your area, there are several ways you can find out. You can contact some of your local non-profit housing agencies and find out if they have HUD approved counselors that can provide information on reverse mortgages. You could also contact the Housing Counseling Clearinghouse on 1-800-569-4287 to obtain the name and telephone number of a HUD-approved counseling agency and a list of FHA approved lenders within your area.

I don’t want to overwhelm you at this point, come back next time for more information on reverse mortgages.

Taffy Wagner

I was finding out such great information regarding buying a home using a FHA loan that I thought I should finish it up today. When we finished up last time I was sharing about no minimum FICO Score. That one is so huge to me I just thought I had to mention it again. Hold on to your seat, because this is going to be an eye-opener for many reading this blog.

FHA will allow a home purchase three years after a Foreclosure. How long has it been that we have been hearing news story after news story after news story about foreclosures in numerous states. Watch your local and world news, I am sure you will see that this is still a top story. Why you ask? People who are in a foreclosure situation have to go somewhere whether it is back to apartment living, living with a relative or renting a house. They have to have options as well.

Here is something that I wasn’t aware of and thought you should know as well that you do not have to be a first time home buyer to obtain a FHA loan. Anyone may use a FHA loan as long as you don’t have more than one FHA insured loan at any one time. Well that definitely makes sense.

Maybe you have read this and ask is there financing available? There is financing available. Different programs have 100% financing available. I have always been cautious about doing 100% financing because that can make your monthly payment more than you can afford. For that reason, I recommend you research the down payment assistance and closing costs. Do not put yourself in a bind for a home loan or you will not enjoy what is supposed to be the American Dream.

Here is a fact about using a FHA Loan that I did not know could apply to the FHA Loan and I believe it will benefit many more people as time goes on. Self-Employed individuals can apply for a FHA Loan. I am shocked by this. When my husband and I were in the process of searching for another home and he had become self-employed, they talked to us about a No Doc Loan but there was never any mention of a FHA Loan. We did not go with the No Doc Loan because I continued to work. So we had options. Whether you are getting a FHA Loan or anything else, make sure that you have options that you can live with.

I have shared some of the different advantages of the FHA loan program that should assist you in making an informed decision when it comes to home loans. Is there all there is to the FHA loan program? Of course not; however, I wanted to give some brief insight into the program so you would know what exists.

I know from my own research, I would advocate people look into FHA loans. I believe it would be a good solution in the long term.

There are many home ownership programs created to help increase home ownership. However, do they really help increase home ownership or are they more of a deterrent? Let me share what I mean, is there so much “red tape” and regulations that the potential buyer will not understand that at the end of the day they say forget it. I will continue apartment living.

We all know people that want to obtain the American Dream. So of you probably can even remember when you were the person seeking to obtain the Dream. There are some details you should know about buying a home using a FHA loan that you might not have known about. I believe the information I am preparing to share with you will get you excited about becoming a home owner. I was doing some research about the different FHA loans and I have to share what I found.

First, were you aware in the minimal down payment and closing costs it extends to the down payment being less than 3%. I can see some of you doing a double take right now as you read that on the screen. Why? You had no idea that you could get into a home for that a small amount of money. That makes it so much more attainable right! Don’t run right out now and get a house based on that. Continue reading this blog and see what else you need to know.

Second, you can utilize a gift for down payment and closing costs. There are many programs available for first time home buyers and more. One item I always counsel new home buyers on is not utilizing all their cash for down payment or closing costs. With all the programs existing, do the research and find out which one fits your particular situation.

I have to stop and share this at this very moment because I was not knowledgeable of this CRUCIAL information that can make the difference for many people. Buying a home through FHA Loan has easier credit qualifying guidelines. Let me take it a step further, from my research I found that there is no minimum FICO score. Stop! So many people have not gotten a house because of their low FICO score. I can hear people right now in amazement saying they did not know that.

Furthermore there is no credit score requirement. That does not mean if you have a few marks on your credit report that you should not clean them up. By all means clean them up. However, know in my opinion FHA is saying you do not have to have perfect credit in order to obtain a loan through them.

Maybe you are reading this and have had a bankruptcy in the last few years. Did you know that FHA will allow a home purchase two years after a bankruptcy. I have to tell you I am surprised by that. I tend to encourage people that I counsel to wait until you have gotten more of a handle on your finances. Maybe FHA has a program they have worked out that can instill money management and rebuilding the family unit as you obtain the American Dream and give better guidance.

I have not even finished what I am going to share. I would say come back and read again next time when I will give you some more insight into buying a home with a FHA loan.

The Federal Housing Administration has been helping people become homeowners since the 1930s.

The FHA fell out of favor over the past two decades as loose loan providers offered prospective homebuyers of all stripes financing without proof of income or financing restrictions. Now, the housing market and the country’s economic market as a whole are suffering the consequences of widespread failure and foreclosure stemming from the subprime market.

As such, more and more first time homebyers and current homeowners looking to refinance are turning to government-backed programs such as the FHA. With legislation pending in Congress and the announcement of FHASecure earlier this year, FHA home financing is returning to the consciousness of the American housing industry.

Rightly, the agency insures FHA loans, making sure that if you cannot pay the loan and wind up defaulting, the lender is covered financially. That way, knowing they’ve got some protection, lenders can feel free to offer customers better loan terms and conditions.

The FHA helps people who might not otherwise quality for a mortgage loan find equal footing. These loans come with little to no start-up costs and often feature great rates. People with so-so credit, bankruptcy problems and other income issues may be surprised at their ability to qualify for an FHA loan.

You can also use an FHA loan to make repairs on that fixer-upper you’ve had an eye on. With a FHA loan, home buyers can simply factor in the cost of the renovations and repairs into the overall loan.

Please be sure to return to our blog for updates and explanations of the program. We hope to build a popular resource for interested consumers that they can rely on for honest, up-to-date education about home financing.