George L. Duarte - Mortgage Loans Fremont California Horizon Financial Associates

What Are The Requirements To Sell A Home Using An FHA Loan? Before an owner can market a property to buyers that want to use a FHA loan, he will want to familiarize himself with the FHA’s standards. FHA won’t insure loans on just any property.

While their standards aren’t as stringent as they used to be, a home needs to be in relatively good condition to qualify for FHA financing.

Location And Lot

To qualify for FHA financing, the property has to be located on a road or easement that lets the owner freely enter and exit.

The access also has to be paved with a surface that will work all year a long dirt driveway that washes out in spring won’t qualify.

The FHA also wants the lot to be safe and free of pollution, radiation and other hazards. For that matter, it also needs to provide adequate drainage to keep water away from the house.

Property Exterior

The FHA’s requirements for making a loan start with the home’s roof. To pass muster, the house must have a watertight roof with some future life left. In addition, if the roof has three or more layers of old shingles, they must all be torn off as part of the replacement process.

The property’s exterior has to be free of chipped or damaged paint if the home has any risk of having lead paint. Its foundation should also be free of signs of exterior (and interior) damage. It also needs full exterior walls.

Property Interior

The property’s interior also needs to be inspected. FHA standards require that the home’s major systems be in good working order.

Bedrooms should have egress routes for fire safety and the attic and basement should be free of signs of water or mold damage.

The bottom line is that the FHA wants to make loans on homes that borrowers can occupy. This doesn’t mean that a home has to be in perfect condition to be sold to an FHA mortgage-using borrower. It just needs to be a place that they can live.

What To Know About Shopping For Mortgage Rates Applying for a home loan can be an exciting process; however, this is a major financial decision. Therefore, potential homeowners need to make sure they understand how to shop for the best mortgage rate possible. A mortgage is usually a long-term loan, allowing potential homeowners to purchase a home using small monthly payments. Fortunately, there are a variety of tools available that can make the process easier. What do potential homeowners need to know when shopping for mortgage rates?

Do Get A Pre-Approval Letter

First, all potential homeowners need to get a pre-approval letter before they start the home-buying process. Because the market is competitive, buyers need to get a pre-approval letter to show they can secure financing for a home they want to purchase. Sellers want to know the deal is going to go through if they make an agreement with someone. The pre-approval letter will allow someone applying for a home loan to compete with other offers, including cash ones.

Do Not Go The Easy Route

One of the biggest mistakes people make when taking out a home loan is going with their existing bank. It is possible their current bank may provide competitive rates; however, applicants should not choose their existing bank solely because this is the easiest option. Instead of going with the easiest option, get the best possible rate from a lender.

Do Work With A Professional

Applying for a mortgage is a complicated process, so potential homeowners need to work with a professional who can guide the way. A trained, licensed professional can help applicants go through this process, explaining why they need certain documents. Then, a professional loan officer can advocate on behalf of the applicant, increasing their chances of earning approval from the lender.

Do Not Overlook Other Potential Expenses

Many homeowners overlook other potential expenses that come with owning a home. For example, homeowners also need to budget for real estate taxes and homeowners’ insurance. Even though this is wrapped into the monthly payment, this is not included in the mortgage. This can blindside homeowners who are not prepared. Homeowners also need to think about potential maintenance expenses. This is important when homeowners are trying to budget accordingly.

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