FHA Resources
FHA Funding Fee
& MIP Explanation
FHA Condo Lookup
FHA Calculation
FHA Funding
Fee & MIP Calculator
FHA Limits Look Up
FHA Q & A
FHA Loan Limits
Home Buying Videos
Here are some great home buying videos produced by the Department
of Housing and Urban Development
Shopping for Your Home
Shopping for Your Loan
Closing the Deal
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What's an FHA Mortgage?
In 1934 Congress established the Federal Housing
Administration (FHA) as part of
the National Housing Act of 1934. This legislation was designed
to invigorate homeownership and extend home owners with
refinance possibilities not possible during the great
depression. The FHA became a part of the Department of Housing
and Urban Development (HUD) in 1965. This is the reason "FHA"
and "HUD" is used interchangeably.
When the FHA was established, the real estate industry was flat
on its back. Over 2 million
construction workers were out of work. Home buyers found the
loan terms impossible to meet. The minimum down payment
requirement was 50%. The repayment schedule was spread over 3 to
5 years and ending with a balloon payment. Just 4 in 10 families
owned homes. FHA does not lend directly to prospective home
buyers and home owners, but works with FHA approved banks and
mortgage brokers to offer FHA financing. The Federal Housing
Administration insures banks against loss in the event of home
foreclosure.
 The
FHA charges mortgage insurance (FHA Funding Fee) on loans made
using the program. If a borrower defaults on the loan the FHA
uses the money from the mortgage insurance premiums to
compensate the lender (in other words, but the lender out).
HUD/FHA take ownership of the home and attempt to sell the home
as quickly as possible. FHA owned homes are commonly called “HUD
homes”.
 What's
an FHA Funding Fee? And how much is it?
A common question, I have a whole
page dedicated to the answer. You will find it
here: FHA Funding
Fee & MIP Explanation.
Is there an income limit on an FHA loan?
There is no income limit for an FHA mortgage
loan.
 Is there a maximum FHA loan?
Yes! Most US counties have a maximum FHA
mortgage limit of $271,050 for a single family home or
"approved" FHA condominium. FHA loan limits are higher for
duplexes, triplexes and 4 unit buildings. For a single family
home at the $271,050 limit means that the sales price without
additional down payment is $280,880.83. The minimum down payment
is 3 1/2%
I have provided links to the maximum FHA loan limits for all US
counties on the left column. You will be redirected to an
ancillary web site that provides the FHA mortgage limits.
What's the minimum FHA down payment?
The minimum down payment on a 30 and 15 year FHA
mortgage is 3 1/2%.
Can I finance my closing costs?
No, but the FHA funding fee can be financed Read more about the
upfront funding fee on the
FHA Funding Fee &
MIP Explanation
What's the monthly mortgage insurance (mip or pmi)?
You can learn more on the mip calculation with this link:
FHA Funding Fee
& Monthly Mortgage Insurance
As of April 18, 2011, the monthly mortgage
insurance is:
MONTHLY MORTGAGE INSURANCE
PAYMENT - MIP
| Sales
price is $100,000
|
30 Years
with minimum down payment (i.e. 3 1/2%)
|
30 Years
with 5% or more down payment
|
15 Years
with minimum down payment (i.e. 3 1/2%)
|
15 Years
with 5% or more down payment |
| Base Mortgage |
$96,500 |
$96,500 |
$96,500 |
$96,500 |
| MIP percentage |
X .0115 |
X .0110 |
X .00500 |
X .00250 |
| Annual Cost |
$1,109.75 |
$1,061.50 |
$482.50 |
$241.25 |
| Divided by 12 Months |
|
|
|
|
| Monthly MIP Cost |
$92.48 |
$88.46 |
$40.21 |
$20.10 |
Can I have two FHA mortgages?
Here's the answer directly from
HUD:
Only under the following situations described below:
a) Relocation - Relocating to another
area not within a reasonable commuting distance from the current
principal residence. There is no need to reduce the principal
balance. Reference to HUD Handbook 4155.1, 4.B.2.d and
Mortgagee Letter 2008-25.
b) Increase in Family Size AND the
outstanding mortgage balance on the present property is paid
down to 75 percent or less LTV exclusive of any financed MIP. 1
- A current residential appraisal must be used to determine LTV
compliance. 2 - The borrower must provide satisfactory evidence
of the increase in dependents and how the property no longer
meet the family needs. See Handbook 4155.1, 4.B.2.d.
c) Vacating a jointly owned property;
Please Note: Situation cited in HUD Handbook 4155.1, 4.B.2.d. is
only meant to be one example of an acceptable situation.
d) Non-occupying co-borrower; On a
case-by-case basis, a relative could be a non-occupying
co-borrower on more than one FHA-insured property. For example,
Mom and Dad are non-occupying co-borrowers on both son and
daughter's FHA-insured mortgages.
Reference Handbook 4155.1, 4.B.2.d.
Note: To prevent circumvention of the restrictions on
FHA-insured mortgages to investors, FHA generally will not
insure more than one mortgage for any borrower (transactions in
which an existing FHA mortgage is paid off and another FHA
mortgage is acquired are acceptable.FHA will not insure a
mortgage if FHA concludes that the transaction was designed to
use FHA mortgage insurance as a vehicle for obtaining investment
properties, even if the property to be encumbered will be the
only one owned using FHA mortgage insurance.
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