If you have never heard of the Value Gap Refinance, you probably will. The Value Gap Refinance program means that there is a guarantor making up the difference between the existing mortgage and the present value of the home. Sound like a dream come true? It will help those who are underwater but it certainly doesn’t change the economy….at least not at this moment.
The difference would need to be established by getting an appraisal of course, that way it is clear what the value is based on the current market. The homeowner would then obtain a new loan at 100 percent of the property’s value and at the current rates.
The homeowner is responsible for paying off the balance, but not the dollar figure that creates that gap. When the home is eventually resold to another buyer down the road, the government will pay the difference between the final selling price and the original loan balance. It’s a program that has been a long time coming, and helping people is what it’s all about.
-Mayer Dallal
Showing posts with label fha appraisal guidelines. Show all posts
Showing posts with label fha appraisal guidelines. Show all posts
Friday, October 29, 2010
Monday, October 25, 2010
Unreasonable Requirements
In the past year FHA has made several changes, some of which borrowers thought were too strict. Lenders are now getting rules that are more strict as well, so it applies to everyone. You are probably wondering what makes or breaks a lender in the process of qualifying to do FHA loans, and so I will share a little bit of that information with you, and the reason why things are changing.
The FHA, or Federal Housing Administration doesn’t loan money, but they do insure loans for banks and lenders. Lenders and banks have always had to show that they have a strong and reasonable force behind them financially to do FHA loans. HUD is now asking lenders and banks to reimburse them for loans that were not done according to the agency’s guidelines. Sound odd? Not really, and it isn’t in force yet, but if an agency is insuring loans for that lender they should be doing things right. Insuring loans is risky, and means that if the borrower defaults on the loan then the FHA covers it. So, it makes sense that they would want to take every step possible to ensure that the loans are being done properly.
All in all, this may be part of the reason that the FHA took steps in January of this year to write new regulations and standards regarding their requirements, along with increases in mortgage insurance. The FHA simply needed to find a way to strengthen its insurance fund, and prepare to insure more loans. The FHA loan programs have been booming as a result of a bad economy, in which families were able to buy with less money down than they would have been required to come up with if doing a conventional loan. The major uncertainty was only in the fact that once someone bought a home could they maintain the payments and upkeep? This is the question that FHA is asking to ensure that lenders are calculating debt-to-income ratios properly meaning that families are able to afford the monthly payments after all other bills have been accounted for.
In the past, banks were letting families buy homes with a debt-to-income ratio of 50% or higher. This doesn’t even sound right when we already know that these families have hardly any disposable income left at all. When families have little left over, and they have to choose between feeding the children and paying the mortgage, then they are naturally going to feed the children. Tight monthly budgets have triggered defaults, and therefore this includes even FHA loans too. The FHA wants to make sure that the lenders are following their guidelines, and not just passing deals through to get them done. This will be a huge benefit to everyone.
To find out more about getting your FHA loan today, you can go to www.fhaloansnow.net. You are welcome to use my FHA calculator there to see what fits into your monthly budget before you spend.
-Mayer Dallal
The FHA, or Federal Housing Administration doesn’t loan money, but they do insure loans for banks and lenders. Lenders and banks have always had to show that they have a strong and reasonable force behind them financially to do FHA loans. HUD is now asking lenders and banks to reimburse them for loans that were not done according to the agency’s guidelines. Sound odd? Not really, and it isn’t in force yet, but if an agency is insuring loans for that lender they should be doing things right. Insuring loans is risky, and means that if the borrower defaults on the loan then the FHA covers it. So, it makes sense that they would want to take every step possible to ensure that the loans are being done properly.
All in all, this may be part of the reason that the FHA took steps in January of this year to write new regulations and standards regarding their requirements, along with increases in mortgage insurance. The FHA simply needed to find a way to strengthen its insurance fund, and prepare to insure more loans. The FHA loan programs have been booming as a result of a bad economy, in which families were able to buy with less money down than they would have been required to come up with if doing a conventional loan. The major uncertainty was only in the fact that once someone bought a home could they maintain the payments and upkeep? This is the question that FHA is asking to ensure that lenders are calculating debt-to-income ratios properly meaning that families are able to afford the monthly payments after all other bills have been accounted for.
In the past, banks were letting families buy homes with a debt-to-income ratio of 50% or higher. This doesn’t even sound right when we already know that these families have hardly any disposable income left at all. When families have little left over, and they have to choose between feeding the children and paying the mortgage, then they are naturally going to feed the children. Tight monthly budgets have triggered defaults, and therefore this includes even FHA loans too. The FHA wants to make sure that the lenders are following their guidelines, and not just passing deals through to get them done. This will be a huge benefit to everyone.
To find out more about getting your FHA loan today, you can go to www.fhaloansnow.net. You are welcome to use my FHA calculator there to see what fits into your monthly budget before you spend.
-Mayer Dallal
Thursday, July 22, 2010
Adjustments in the FHA Down Payments
FHA Down Payment Gets Adjusted
In January, FHA made adjustments to the down payment requirements. This change in the FHA down payment requirements threw some borrowers for a loop, while others weren’t greatly affected by it. Let me explain.
The FHA down payment guidelines, allows home buyers to put as little as 3.5% down, and up to 3% in seller concessions. Prior to the changes the seller was able to contribute up to 6% in seller concessions, so for those who were planning to buy and hadn’t started the process yet, had to back off until they could come up with more money.
Fore more information, you can visit my website at http://www.fhaloansnow.net/. There you can find information on purchasing and refinancing too.
-Mayer Dallal
In January, FHA made adjustments to the down payment requirements. This change in the FHA down payment requirements threw some borrowers for a loop, while others weren’t greatly affected by it. Let me explain.
The FHA down payment guidelines, allows home buyers to put as little as 3.5% down, and up to 3% in seller concessions. Prior to the changes the seller was able to contribute up to 6% in seller concessions, so for those who were planning to buy and hadn’t started the process yet, had to back off until they could come up with more money.
Fore more information, you can visit my website at http://www.fhaloansnow.net/. There you can find information on purchasing and refinancing too.
-Mayer Dallal
Wednesday, July 14, 2010
FHA Mortgage Refinancing
You can refinance into an FHA loan whether you have one now or not. You can refinance to get cash out, use a streamline to pay off bills, or even just refinance to lower your monthly payments. Once those who have a conventional loan learn more about the details of FHA, they begin to see the difference in terms of the benefits that FHA has to offer. For example, there may be some borrowers who had perfect credit when they took out their conventional loan, but then along the way they had job loss, had medical collections, or may have had to file a bankruptcy as a result of these experiences. It’s easier to get qualified after a bankruptcy for an FHA loan, than it is for a conventional loan. FHA also offers more options to the borrower if they are having difficulties, because they back the loan for the lender to protect them if the borrower defaults.
If a borrower has a conventional loan, then the FHA mortgage refinancing guidelines will allow them to go up to 97.75% loan to value, so long as nothing is being paid off and no cash is coming back to the borrower at the closing. The only thing that can be included in the loan is the payoff of their current mortgage. FHA does allow cash-out loans on those properties that have been owned for one year prior to the FHA refinance, but it must be a primary residence. These loans do allow for the borrower to go up to the maximum of 85% loan to value, based upon the appraisal of the property.
An FHA refinance mortgage is when a borrower refinances their current mortgage for more than they currently owe in order to pull out the equity that they have built up that has accrued on their home. The amount that any homeowner can borrow is limited by the value of the property compared to the loan amount.
For more information on FHA, and the guidelines associated with FHA mortgage refinancing, please feel free to visit www.fhaloansnow.net. Here you will find valuable information and an FHA calculator where you can input information to help you find out how much you can afford.
If a borrower has a conventional loan, then the FHA mortgage refinancing guidelines will allow them to go up to 97.75% loan to value, so long as nothing is being paid off and no cash is coming back to the borrower at the closing. The only thing that can be included in the loan is the payoff of their current mortgage. FHA does allow cash-out loans on those properties that have been owned for one year prior to the FHA refinance, but it must be a primary residence. These loans do allow for the borrower to go up to the maximum of 85% loan to value, based upon the appraisal of the property.
An FHA refinance mortgage is when a borrower refinances their current mortgage for more than they currently owe in order to pull out the equity that they have built up that has accrued on their home. The amount that any homeowner can borrow is limited by the value of the property compared to the loan amount.
For more information on FHA, and the guidelines associated with FHA mortgage refinancing, please feel free to visit www.fhaloansnow.net. Here you will find valuable information and an FHA calculator where you can input information to help you find out how much you can afford.
Saturday, June 12, 2010
FHA Energy Efficient Home Loans
Not many people are aware of the financing available for FHA energy efficient financing. While it is not common in many areas, there are families that will opt for it. Part of the battle is just having a professional that will make you aware of all of your options.
FHA’s energy efficient financing can be worked into the loan whether it’s a purchase or a refinance. The key here is determine to what extent you need the work done. The FHA energy efficient financing can be used in conjunction with the 203b program. This program is what allows you to get repairs done on the home when you purchase, or get them done during a refinance. Even with a purchase, it is worked into the loan, and if it isn’t and your improvements are minimal, then at some point you can do a Title I HUD loan.
Title I HUD loans can only be done by a bank that is approved to do them, and they are usually smaller loan amounts of $5-$8,000. These can be done at anytime, and are a good idea for those who might end up with some expenditures they weren’t expecting.
I know families that have used FHA Energy Efficient financing in the past for solar panels, energy efficient appliances and more. You might want to check it out if you are looking at buying a home that needs a little work.
For more information on FHA guidelines and products, you can visit my website at: www.fhaloansnow.net.
-Mayer Dallal
FHA’s energy efficient financing can be worked into the loan whether it’s a purchase or a refinance. The key here is determine to what extent you need the work done. The FHA energy efficient financing can be used in conjunction with the 203b program. This program is what allows you to get repairs done on the home when you purchase, or get them done during a refinance. Even with a purchase, it is worked into the loan, and if it isn’t and your improvements are minimal, then at some point you can do a Title I HUD loan.
Title I HUD loans can only be done by a bank that is approved to do them, and they are usually smaller loan amounts of $5-$8,000. These can be done at anytime, and are a good idea for those who might end up with some expenditures they weren’t expecting.
I know families that have used FHA Energy Efficient financing in the past for solar panels, energy efficient appliances and more. You might want to check it out if you are looking at buying a home that needs a little work.
For more information on FHA guidelines and products, you can visit my website at: www.fhaloansnow.net.
-Mayer Dallal
Thursday, June 10, 2010
FHA and Gifted Funds
Believe it or not, with all of the fraud in FHA, it is no wonder that they have asked that gifted funds be documented every step of the way. FHA and gifted funds do get along, but it does have some strings attached.
With FHA priding themselves on commonsense lending, they also consider it commonsense that the person gifting you funds is logic; meaning a parent, sibling or other close relatives. FHA will allow other sources to fund you, but it has to make sense. In some circumstances it would be an employer or a close friend or current roommate, but FHA’s guidelines on gifted funds simply state it needs to be verified.
The reasoning behind verifying the gifted funds makes perfect sense. The lender knows that statistically speaking those who enter into a transaction with no invested funds are more likely to default on a loan, so it is in the best interest of all involved for FHA to verify gifted funds.
Many times the buyer may take it personal, but it really isn’t meant to invade your privacy, but understand that FHA has already allowed for low down payment funds up front. They only now ask for as little as 3.5% down so there isn’t a huge out of pocket needed depending on how much you are spending.
The fact that FHA allows gifted funds is a gift in itself. This is something you would be hard pressed to do on a conventional loan, so beware.
For more information on FHA and gifted funds, please visit my website at www.fhaloansnow.net.
-Mayer Dallal
With FHA priding themselves on commonsense lending, they also consider it commonsense that the person gifting you funds is logic; meaning a parent, sibling or other close relatives. FHA will allow other sources to fund you, but it has to make sense. In some circumstances it would be an employer or a close friend or current roommate, but FHA’s guidelines on gifted funds simply state it needs to be verified.
The reasoning behind verifying the gifted funds makes perfect sense. The lender knows that statistically speaking those who enter into a transaction with no invested funds are more likely to default on a loan, so it is in the best interest of all involved for FHA to verify gifted funds.
Many times the buyer may take it personal, but it really isn’t meant to invade your privacy, but understand that FHA has already allowed for low down payment funds up front. They only now ask for as little as 3.5% down so there isn’t a huge out of pocket needed depending on how much you are spending.
The fact that FHA allows gifted funds is a gift in itself. This is something you would be hard pressed to do on a conventional loan, so beware.
For more information on FHA and gifted funds, please visit my website at www.fhaloansnow.net.
-Mayer Dallal
Loving the FHA Calculator
I love the FHA calculator because it’s such a useful tool to help people know where they stand. People are going out trying to find ways to spend money they don’t have, and they shouldn’t. The use of the FHA calculator keeps it simple, and puts everything in perspective before you get carried away.
It is never too early to figure out how much you can afford, and the best part is it’s so easy to do with the FHA calculator. This is why I have them on my website, and encourage everyone to use them. You can plug in the loan amount, so if you have a particular house in mind then go with that. This way, you will know if what you are looking at is in your range. In addition, you can just plug in the interest rate and term, and it will give you the monthly payment with principal and interest, and with taxes and insurance.
The FHA calculator gives you real expectations on what you can afford, and that way when you search for a house, you will know what is in your budget and what isn’t. It’s all a matter of knowing what you can pay for, and if you don’t have any idea than you are in for a rude awakening. Go to your loan officer with confidence and knowledge that you have an understanding of what you can spend. For more information, or to view my FHA calculator on my website, you can go to www.fhaloansnow.net.
-Mayer Dallal
It is never too early to figure out how much you can afford, and the best part is it’s so easy to do with the FHA calculator. This is why I have them on my website, and encourage everyone to use them. You can plug in the loan amount, so if you have a particular house in mind then go with that. This way, you will know if what you are looking at is in your range. In addition, you can just plug in the interest rate and term, and it will give you the monthly payment with principal and interest, and with taxes and insurance.
The FHA calculator gives you real expectations on what you can afford, and that way when you search for a house, you will know what is in your budget and what isn’t. It’s all a matter of knowing what you can pay for, and if you don’t have any idea than you are in for a rude awakening. Go to your loan officer with confidence and knowledge that you have an understanding of what you can spend. For more information, or to view my FHA calculator on my website, you can go to www.fhaloansnow.net.
-Mayer Dallal
FHA and Your Debt to Income Ratio
FHA looks very closely at your debt to income ratio. Debt to income ratio is a term used to describe your level of outgoing monthly obligations to your income. It’s important before you decide to buy a home that you already know what your debt to income ratio is, and that you have it under control.
FHA would like to see your debt to income ratio at no more than 31%, and that is with your new monthly mortgage payment with principal and interest, and taxes and insurance. There are some cases in which FHA will allow you to go up to 43%, including other obligations, but FHA will look closely at new accounts you have opened. FHA simply wants to ensure that you have not opened up any new accounts in order to help you fund your down payment or pay off other debts prior to your application.
Your debt to income ratio is important, and you need to be responsible to keep your credit and your debts in order. For more information on the FHA guidelines, and to use the FHA calculator, visit www.fhaloansnow.net.
-Mayer Dallal
FHA would like to see your debt to income ratio at no more than 31%, and that is with your new monthly mortgage payment with principal and interest, and taxes and insurance. There are some cases in which FHA will allow you to go up to 43%, including other obligations, but FHA will look closely at new accounts you have opened. FHA simply wants to ensure that you have not opened up any new accounts in order to help you fund your down payment or pay off other debts prior to your application.
Your debt to income ratio is important, and you need to be responsible to keep your credit and your debts in order. For more information on the FHA guidelines, and to use the FHA calculator, visit www.fhaloansnow.net.
-Mayer Dallal
Wednesday, June 9, 2010
Tough Words on FHA Down Payment Assistance
FHA down payment assistance programs were eliminated back in 2008. This was a shock to many who were really hoping to take advantage of these programs and to me as well. I had hopes of seeing some families get to take advantage of this, but there were some reasons why it happened.
FHA is seeking to bring it back, but there is no word for sure on whether or not that is going to happen. These programs being terminated brought losses in excess of $14 billion for FHA. U.S. Representative, Al Green, a Texas Democrat, wanted to see the FHA down payment assistance programs reignited through donations from non-profit organizations. These FHA down payment assistance programs would be funded by 3% for those who are considered low income buyers.
Whether or not this will work, there is no way to know for sure, but lawmakers wanted to halt the FHA down payment assistance programs because they felt it would encourage default. It seems that the government can’t strike a balance and that no matter what the arguments will go back and forth until someone gives up.
I would like to see FHA down payment assistance programs return, but unfortunately I don’t get a say in how this happens. All we can do is wait and see what tomorrow holds for us. Until next time, much success to you and your family. For more information on the current FHA guidelines, please visit my website, www.fhaloansnow.net.
-Mayer Dallal
FHA is seeking to bring it back, but there is no word for sure on whether or not that is going to happen. These programs being terminated brought losses in excess of $14 billion for FHA. U.S. Representative, Al Green, a Texas Democrat, wanted to see the FHA down payment assistance programs reignited through donations from non-profit organizations. These FHA down payment assistance programs would be funded by 3% for those who are considered low income buyers.
Whether or not this will work, there is no way to know for sure, but lawmakers wanted to halt the FHA down payment assistance programs because they felt it would encourage default. It seems that the government can’t strike a balance and that no matter what the arguments will go back and forth until someone gives up.
I would like to see FHA down payment assistance programs return, but unfortunately I don’t get a say in how this happens. All we can do is wait and see what tomorrow holds for us. Until next time, much success to you and your family. For more information on the current FHA guidelines, please visit my website, www.fhaloansnow.net.
-Mayer Dallal
Monday, June 7, 2010
Is An FHA Short Term Loan Beneficial?
The FHA bridge loan is not something that you hear a lot about, but that is because when it first came out it wasn’t being talked about by FHA. FHA wanted to keep this one under their hat until the bridge loan was perfected, and the plan they came up with is fine, but is it really a good idea?
I think it depends on the person or family. As with anything in life, it’s all about being responsible, and for those who are irresponsible and don’t save, it may be a bad idea. The short term bridge loan with FHA was designed for those who didn’t have the down payment money for their new purchase. Then, once filing with the IRS, you would know what you are getting back, but it won’t go against your tax credit. So, making sure that you will have the money later is a key factor. Generally speaking, if someone is pretty responsible then changes are they will have the funds to use for a down payment on the home, but if not then the short term bridge loan can be effective.
As with anything, educate yourself and don’t do it just because someone else did or suggested it. When you hear about the FHA short term bridge loan, do some research and look it up for yourself, but what you really need is an expert. For more information, go to www.fhaloansnow.net, and talk to your FHA expert today.
-Mayer Dallal
I think it depends on the person or family. As with anything in life, it’s all about being responsible, and for those who are irresponsible and don’t save, it may be a bad idea. The short term bridge loan with FHA was designed for those who didn’t have the down payment money for their new purchase. Then, once filing with the IRS, you would know what you are getting back, but it won’t go against your tax credit. So, making sure that you will have the money later is a key factor. Generally speaking, if someone is pretty responsible then changes are they will have the funds to use for a down payment on the home, but if not then the short term bridge loan can be effective.
As with anything, educate yourself and don’t do it just because someone else did or suggested it. When you hear about the FHA short term bridge loan, do some research and look it up for yourself, but what you really need is an expert. For more information, go to www.fhaloansnow.net, and talk to your FHA expert today.
-Mayer Dallal
Saturday, June 5, 2010
The FHA Front-End Ratio
The term FHA front-end ratio is a term you will hear when going to apply for your FHA loan. Unfortunately, many times you are bombarded by a ton of financial jargon that doesn’t make a lot of sense to you. I don’t like that loan officers do that, but I can only be accountable for what I do, and how I treat people. I might use those terms too, but I will explain them; that’s just part of being a professional.
The front-end ratio is what the lender will use to qualify you for a loan, so that you know how much you can afford. The lender will take your monthly income, and what your proposed payment would be with principal, interest, taxes and insurance. This total payment can be no more than 31%. This is simply a guide, so that you aren’t getting overextended, although you may want a lower payment. It’s all about watching your cash flow, and doing what is best for you and your family.
The back-end ratio is what the lender looks at when including your new monthly mortgage payment, and all of your recurring debt every month. So, they look at your new monthly payment, plus your car payment and credit card payments, you can be at no more than 43%. This is important, and gets us back to the basics. With these guidelines in place, we shouldn’t be headed down the same path that we were headed down before. For more information on how you can qualify and to use my FHA calculator, please visit my website at www.fhaloansnow.net.
-Mayer Dallal
The front-end ratio is what the lender will use to qualify you for a loan, so that you know how much you can afford. The lender will take your monthly income, and what your proposed payment would be with principal, interest, taxes and insurance. This total payment can be no more than 31%. This is simply a guide, so that you aren’t getting overextended, although you may want a lower payment. It’s all about watching your cash flow, and doing what is best for you and your family.
The back-end ratio is what the lender looks at when including your new monthly mortgage payment, and all of your recurring debt every month. So, they look at your new monthly payment, plus your car payment and credit card payments, you can be at no more than 43%. This is important, and gets us back to the basics. With these guidelines in place, we shouldn’t be headed down the same path that we were headed down before. For more information on how you can qualify and to use my FHA calculator, please visit my website at www.fhaloansnow.net.
-Mayer Dallal
Friday, June 4, 2010
My Desire to See You Succeed
My desire to see you succeed in life is nothing short of genuine. I have been in the mortgage and banking industry over 19 years, and every day I see different scenarios, wondering what is next, what is going to change, and could this market get any worse?
The mortgage and banking industry has been failing over the past several years, and it has failed in different ways. The industry began to fail us when we were allowing banks to do loans for those who were low income, but yet they had five homes; one to live in and four to rent. The shame in this is startling because lenders were giving out money to anyone and everyone who wanted a property, and it became like a hobby and was very frightening.
Having real professionals in place will make a world of difference, and it only takes one right professional. In order for me to make headway in our current mortgage and banking industry, I had to figure out what innovative ways were available to assist my clients in more than one area. I wanted to see those who needed to list a short sale have those resources available. I want to help first time homebuyers get into their home and start a family, and I want to see people be able to repair the damage done to their credit and make better choices.
For more information, and to see what I have to offer, please visit my website:
www.fhaloansnow.net
-Mayer Dallal
The mortgage and banking industry has been failing over the past several years, and it has failed in different ways. The industry began to fail us when we were allowing banks to do loans for those who were low income, but yet they had five homes; one to live in and four to rent. The shame in this is startling because lenders were giving out money to anyone and everyone who wanted a property, and it became like a hobby and was very frightening.
Having real professionals in place will make a world of difference, and it only takes one right professional. In order for me to make headway in our current mortgage and banking industry, I had to figure out what innovative ways were available to assist my clients in more than one area. I wanted to see those who needed to list a short sale have those resources available. I want to help first time homebuyers get into their home and start a family, and I want to see people be able to repair the damage done to their credit and make better choices.
For more information, and to see what I have to offer, please visit my website:
www.fhaloansnow.net
-Mayer Dallal
Thursday, June 3, 2010
FHA and Bankruptcy
Having a good credit rating can affect your ability to borrow money, even when it comes to FHA. FHA has a stigma attached to it that sounds as though anyone can qualify. This isn’t true, and in fact they are looking at your credit closely, but their method is a little different.
FHA uses what is called “commonsense underwriting”, so they won’t hold your past against you completely. FHA bankruptcy rules are stringent, meaning you can’t have a bankruptcy on credit within the past two years. FHA bankruptcy guidelines state that if you have been in a chapter 13 for one year and have made on time payments then they will consider giving you a loan.
When deciding that you want to buy a home or refinance, you need an FHA expert to guide you through the process. I am an expert, and I can help. You can learn more by going to my website, www.fhaloansnow.net.
-Mayer Dallal
FHA uses what is called “commonsense underwriting”, so they won’t hold your past against you completely. FHA bankruptcy rules are stringent, meaning you can’t have a bankruptcy on credit within the past two years. FHA bankruptcy guidelines state that if you have been in a chapter 13 for one year and have made on time payments then they will consider giving you a loan.
When deciding that you want to buy a home or refinance, you need an FHA expert to guide you through the process. I am an expert, and I can help. You can learn more by going to my website, www.fhaloansnow.net.
-Mayer Dallal
Wednesday, June 2, 2010
FHA Appraisers and the Facts
One your FHA offer has been accepted, then you need to get an appraisal done. FHA appraisers are the only appraisers that can do this part of the process. FHA has certain guidelines that they want followed to ensure that the home meets their requirements for the loan.
The FHA appraisal is for the benefit of the lender. Keep in mind that they are looking to lend on a home only for what it’s valued at. We want to always believe that the home is worth more when we buy it because we are proud at how much we spent. Then, we are proud once we own it so we can be sure to get the most of out the loan if we wish to refinance it to pay off debt.
The FHA appraisers must show that they have the proper credentials, and in turn the new requirements prohibit that the mortgage broker request the appraisal on their own. This is to keep everything fair and balanced so that we don’t end up with a mess such as what we have now. They don’t want to lend money on a property that is damaged and not really of that value and they don’t want to have the home over valued to end up with a home that will eventually be upside down. These situations bring about financial hardship for everyone, so trust the expert that handles your FHA loan.
For more information you can go to my website; www.fhaloansnow.net.
-Mayer Dallal
The FHA appraisal is for the benefit of the lender. Keep in mind that they are looking to lend on a home only for what it’s valued at. We want to always believe that the home is worth more when we buy it because we are proud at how much we spent. Then, we are proud once we own it so we can be sure to get the most of out the loan if we wish to refinance it to pay off debt.
The FHA appraisers must show that they have the proper credentials, and in turn the new requirements prohibit that the mortgage broker request the appraisal on their own. This is to keep everything fair and balanced so that we don’t end up with a mess such as what we have now. They don’t want to lend money on a property that is damaged and not really of that value and they don’t want to have the home over valued to end up with a home that will eventually be upside down. These situations bring about financial hardship for everyone, so trust the expert that handles your FHA loan.
For more information you can go to my website; www.fhaloansnow.net.
-Mayer Dallal
Tuesday, June 1, 2010
FHA Appraisal Guidelines
I can remember when appraisals were first becoming an issue. Mortgage brokers and loan officers were sitting in their offices faxing over a pre-comparison to get an estimated value on homes that they were trying to lend money on. The idea behind getting this pre-comparison is that the loan officer and the borrower would know if the estimated value of the home was worth enough to do the loan that they wanted. Many borrowers were trying to estimate how much they would need to borrow in order to bail themselves out of debt. This was never good for a few reasons:
1) You would have loan officers and brokers cherry picking neighborhoods according to where the more valuable properties were located. Then, they would know exactly what they could do to up sell their proposals to the client. It was hard for a family in deep credit card debt to believe that they could get out of their situation unless their home was worth a certain amount of money.
2) Lenders that were contracted with certain appraisers were able to pass loans through very quickly. They had very tight relationships that were based upon the premise of “You scratch my back, and I will scratch yours”. This was a favor type system to keep business moving on both sides, and it seemed to be very effective, yet it wasn’t for the borrower. In many cases, the appraisal values were inflated in order to get more money on the deal.
This is very sad, but new FHA appraisal guidelines implemented don’t allow room for that to happen. FHA appraisal guidelines now state that when doing an FHA loan, the mortgage broker is not allowed to request the appraisal.
FHA appraisal guidelines are now geared to benefit everyone, and they no longer allow the lender to use their own appraisers.
-Mayer Dallal
1) You would have loan officers and brokers cherry picking neighborhoods according to where the more valuable properties were located. Then, they would know exactly what they could do to up sell their proposals to the client. It was hard for a family in deep credit card debt to believe that they could get out of their situation unless their home was worth a certain amount of money.
2) Lenders that were contracted with certain appraisers were able to pass loans through very quickly. They had very tight relationships that were based upon the premise of “You scratch my back, and I will scratch yours”. This was a favor type system to keep business moving on both sides, and it seemed to be very effective, yet it wasn’t for the borrower. In many cases, the appraisal values were inflated in order to get more money on the deal.
This is very sad, but new FHA appraisal guidelines implemented don’t allow room for that to happen. FHA appraisal guidelines now state that when doing an FHA loan, the mortgage broker is not allowed to request the appraisal.
FHA appraisal guidelines are now geared to benefit everyone, and they no longer allow the lender to use their own appraisers.
-Mayer Dallal
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