FHA Mortgage, Interest Rates and Marketing

4155 may sound like the price of a used car but it is actually the FHA bible.  Most people in the mortgage business say it as “Fourty-One, Fifty-Five” as opposed to the Four Thousand One Hundred Fifty Five.   This is the document number assigned to the federal housing administration (FHA) handbook for single family mortgage loans.

These are the FHA Loans that are all the buzz right now in the mortgage business.  If you are a loan officer, processor or any other industry insider who is involved in FHA Loans I suggest you get a copy of the 4155 and study it.  It is THE guidebook for FHA Loans.

 When I  first got into FHA loans back in 1998 I read the 4155 word for word over and over again and it made me a much better originator.  I could quote guidelines in my sleep which gave me a huge advantage.  The 4155 is the FHA BIBLE!

We have recently found out that Taylor Bean and Whitaker is still accepting FHA loans below a 580 credit score with a manual underwrite.

There underwriting times are very slow for this reason because they are getting a lot of loans they cannot approve.  If you have an FHA loan below a 580 credit score and have plenty of time to wait, TBW (Taylor Bean) is your best bet.  I would warn you that if you are going to submit a loan below a 580 credit score you need to make sure it is processed properly! Make sure you understand FHA guidelines and are meeting them, and underwriter will be looking for a reason to decline your loan when the score is this low.  This makes it even more important to present the loan properly when the credit score is below 580 and the loan is FHA.

Although FHA guidelines do state that Overtime pay should have a two year history, a Direct Endorsement Underwriter can make an exception to use overtime with only a 1 year history.  A direct endorsement underwriter can also take previous job history and recent transfers into account when calculating overtime for someone who doesn’t have a full 2 year history.  So if a borrower has less than a 2 year history of overtime you should build a strong case (if it can be built) and present it to an FHA DE Underwriter and see how they feel about the circumstances.

 One of the great benefits of FHA loans is the authority a Direct Endorsement Underwriter has to make judgement calls in good situations.

One of the many great features of an FHA Mortgage Loan is what it can do for borrowers in bankruptcy.  While conventional loan programs turn their back on borrowers with bankruptcies, FHA will allow a borrower who has been in Chapter 13 bankruptcy for only 12 months for refinance their home and buyout the bankruptcy if they have enough equity.   I will be going in depth into the benefits and process for a borrower to take advantage of this program over the coming week, stay tuned!

FHA has the best home equity program available.  It allows you to borrower up to 95% of your homes value, turning equity into cash, and only has .5% mortgage insurance. For more information on FHA Home Equity Loans check out Home-Equity-Loan-Tips.com.

A home equity loan can be a great way to save interest by paying off credit cards, save taxes by converting more of your monthly interest into a tax deduction and increase your credit score (paying off revolving debt increases your credit score).   You can even pay off cars and other debt making that interest tax deductible.  To maximize your financial situation its best to have as much of your debt as possible tied to your house.