FHA Loan Facts: 8 Facts That Will Help You Get A Better Mortgage

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FHA Loan Limites

Some facts are helpful, some are not.  The FHA loan facts covered here are of the first type.

I’m about to cover 8 FHA loan facts that will help you get a better house or a better mortgage or both.  Before I do that, let me disclose this: To keep the lights on at Home Loan Mine many of the links in this blog post are affiliate links. If you register with the websites, through my links, websites that I’ve vetted this week, I’ll earn a small commission each time. If I’m lucky, I’ll earn enough money for lights AND a medium decaf Americano from the Starbucks across the street from my office.

FHA Loan Facts To Make Your Life Easier

Getting A Home Loan With No CreditYou can just show you’ve paid bills on time for the 12 months before you apply. Give your loan officer either by showing 12 months of cancelled checks made to your phone company, gas company, etc.or 12 months’ worth of bank statements showing on-time electronic payments to your phone company, etc).

FHA down payment can be a gift from a family member or close associateYou must have 3.5% of the loan amount as down payment, but it can be a gift from a relative or close associate. The donors must be willing to give you the gift, fill out a form that states they funds are a gift, and show bank transaction history to prove they had the funds they’re gifting. And that’s it!

Woman holding a poster about HA Upfront Mortgage Insurance PremiumsThere is an upfront mortgage insurance premium of 1.75% of the loan, but it can be rolled into the loan. On larger loan amounts, it’s real money we’re talking about ($4,371 for a loan of $250,000).

FHA Seller Credit

You can get up to 6% seller credit. (Actually, you can get credit from other parties too.  The total cannot exceed 6% of the sale price.) You can apply that credit to closing costs, prepaid expenses, discount points, and other financing concessions. You cannot apply it to your down payment, to reduce your loan principal, or otherwise get any amount above the actual closing cost amount.

FHA Refinance Loans for Doll Houses?
FHA Refinance Loans for Doll Houses?

FHA’s Streamline refinance allows you to refinance your FHA loan without showing income, credit scores, or an appraisal. (Unless you want to cash-out, then you do need an appraisal.) Lenders have to check only your mortgage payments over the previous 12 months.

Non-Occupant Co-Borrower FHA LoansNon-occupant co-borrowers are allowed (so a relative with better income can be on the loan to get you to qualify). Even if they already own a home. Or if they like you enough to get a loan with you but not to live with you.

FHA 203K loans?FHA’s 203K loan program allows you to demolish a property and build a new one in its place (as long as you keep the original foundation).. It also allows you to buy a home that needs work or to remodel your existing home.

FHA’s Solar and Wind Technologies Program

There’s an FHA loan program to help pay for installing solar panels. It is called FHA’s Solar and Wind Technologies Program. It allows you to add the full cost of solar panels to the loan. The loan amount with the panels in cannot exceed county limits. But it’s quite useful.  Solar panel costs have come down lately.  Still, they are significant.  For a 1300 square feet house in my area, they cost over $20,000. 

FHA Loan Facts Conclusion

I hope these FHA loan facts helped you get a better idea of how useful FHA loans are. I have more FHA loan facts on this site, so browse around.

 

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