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Does your Dream Home Qualify for an FHA Loan in Texas?

qualify for an FHA loan in texas

Is work moving you to a new location or is your lease coming to an end? Are you ready to take on the financial responsibility of becoming a homeowner? Shopping for a new home is exciting and before you start looking, find out which loan you are going to use. Using an FHA loan in Texas is a great alternative for you if you are trying to build your credit score or need a little financial assistance. Before you start shopping, find out what your future home requirements are to qualify for an FHA loan in Texas.

What are the Requirements to Qualify for an FHA Loan in Texas?

Requirements are made not to take away any possible homes from you but to keep you safe. The requirements are straightforward: the home must be safe, secure, and stable. The loan will not be approved for an extension of a home, only for a single piece of real estate. As a first-time buyer, you may not know what possible issues to look for, which is why some standards are set. The requirements also protect you from any sellers who refuse to fix a hazardous problem. There are some minor issues that will still pass (such as a leaky faucet) but will be brought to your attention.

The Exterior Requirements

The exterior of the home is the structure, roof, electric box, driveway, porches, yard, HVAC units, and anything else that is on the outside of your dream home. First, the roof must be in good condition. Have you heard the expression, “As long as we have a roof over our heads?” A roof protects your house from moisture and any kind of intruders (bugs or people). Additionally, all exterior walls must have no damage. The drainage must not puddle around the home but move away to avoid problems like flooding and water damage. The home and property must be hazardous-free, meaning no large amount of pollution or radioactive materials. Overall, the construction must be completely secure.

The Interior Requirements

The interior of your future home is just as important as the exterior. The overall sanitation is an absolute must. Without that there is a risk of a bug infestation or a mold problem that can harm your future home or you. There must be separate utilities that you can pay and maintain. You may share common services such as laundry facilities. There must be enough bedrooms and bathrooms with showers or bathtubs for you and anyone living in your home. There must be enough room for cooking, eating, and sleeping for every resident. Finally, the attic must have exposure to air and the crawl space must be free of any remains.
Buying a house with an FHA loan in Texas is a great way to buy your dream home. The FHA loan will not only help you financially purchase your home, but it will guide in buying a safe home. The FHA loan requirements are again very simple: your future home must be safe, secure, and structurally stable. Horizon FHA Loans can help you get pre-approved this week. Go to their website and fill out their quick form and see what you can receive.

What is the Difference Between FHA and VA Loans in Texas?

FHA VA Loans Texas

Are you one of those people who has your dream home completely planned, all the way down to the white picket fence, but finances are holding you back from finding it? In the state of Texas, there are a variety of loans that individuals can apply for, so even those without large savings can buy a home. Horizon FHA Loans offers both FHA and VA loans in Texas. For individuals who lack a good credit score, the FHA loan may be the best option. For veterans, a great option is the VA loan. Assistance is available for those who need it, so shop around for the ideal loan for you.

What is a VA Loan?

The VA loan is one of the many benefits a service member receives by protecting our country. It is there to help service members and their families who are required to move frequently because it offers a quicker process and strict guidelines. The homes for purchase cannot have any serious issues, and depending on the shape of the home, the inspector can deny a home purchase for extremely worn carpets. This can keep veterans safe, but may ruin any fixer-upper plans they might have.

Choosing a VA loan can help an individual save a large amount and provide a safe place to live. The VA loan gives you the option of having absolutely no down payment. When choosing the VA loan, the service member’s family will have lower monthly payments versus using private mortgage insurances. This loan also offers competitive lower interest rates. The homeowner has two ways to refinance his already low-interest rates. Streamline refinancing is the most popular choice; it will allow the owner to refinance his mortgage for even lower interest rates and more savings. The second option is cash-out refinancing, in which the homeowner can take advantage of the equity of his home and use the extra cash for whatever he needs.

What is an FHA Loan?

The FHA Loan is a wonderful option for those who are coming out a rough place financially. It is also very easy to qualify for but is truly worth more for those between a FICO number of 580 and 700. Once your credit becomes higher, it will have more costly disadvantages than savings. Through the FHA loan, your down payment is 3.5% and can be paid by gift fund sources. The seller is required to pay 6% of the closing cost, making it easier to purchase your dream home.

The loan is designed with more flexible underwritings because most of its customers are building their credit. The downfall of the loan’s guidelines is that it has a cap-off on the mortgage loans it will give. In 2017 for a single-family home, a buyer has a maximum of $417,000 available. Depending on where you are looking is what they base the amount granted. The FHA loan does allow for the purchase of a fixer-upper, but only for primary homes.

If you are either a veteran or someone needing assistance, Horizon FHA Loans offers both FHA and VA loans in Texas. The VA loan has many advantages for all those who have served our country. The FHA loan is a great opportunity for families who are working forward to a brighter future. If you are looking for a home in Texas, check out these loans if you fit the criteria.

What Do You Need to Qualify for a Texas Veteran Home Loan?

The criteria needed to qualify for a Texas veteran home loan is very similar to a VA mortgage. However, Texas veteran home loans have the added requirement that you are or have the intent to remain in Texas, or in other words, are “a bona fide resident.” Veteran home loans can make a major difference in your life. Here is what you need to qualify for a Texas veteran home loan.

Active Duty Qualifications

Active Duty Personnel are eligible to qualify for a Texas veteran home loan after having served at least 90 days during wartime and 180 during peacetime. During this time, you must have had a continuous active status.

Prior Service Eligibility

You can also qualify for a loan with prior service. Whether your service occurred during wartime or peacetime determines your eligibility. In order to become eligible for wartime prior service, you must have served for a minimum of 90 days on active duty. A release from active duty can come from anything other than a dishonorable discharge. Under some circumstances, a less than 90-day service may make personnel eligible. This is primarily if a disability required the personnel to step down. To become eligible during peacetime, you must have served a minimum of 181 days of continuous active duty and have been released or discharged for any reason except for dishonorable discharge.

Selected Reserve

Along with active and prior service qualifications, you can also qualify through the Selected Reserve. You may also qualify if you have been discharged because of a service-related disability and have been given an honorable discharge, have been placed on the retired list, have been transferred to an element of the Ready Reserve, or are currently continuing to serve in the Selected Reserve.

There are several ways to qualify for a Texas veteran home loan.  Active duty, prior service, and selected reserve qualifications can all help your qualify for a veteran home loan in Texas. Texas also offers a few additional ways to qualify. These include certain US citizens, surviving spouses, personnel discharged for disability, medical conditions, or mental conditions. A Texas veteran home loan can make a big difference in your finances. For more information on how you can qualify for a veteran home loan, contact Horizon FHA. Call us today at 972-569-7226 to make that big move you’ve been dreaming of a reality.

Avoiding Monthly PMI by Going from FHA Loans in Texas to Conventional Loans

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FHA loans in Texas have opened the housing market to many more prospective homeowners. They put dreams of homeownership within reach of more citizens by drastically lowering payment requirements and minimizing closing costs. As wonderful as this program is, however, it does have a drawback, and that drawback is monthly PMI (Private Mortgage Insurance). It’s this recurring cost that drives many homeowners to refinance through convention loans.

Differences in Initial Costs

Most new homeowners who choose FHA or VA loans do so to avoid large down payments and closing costs. This system has enabled far more people to buy homes, and it’s a very effective way to purchase a new home. After all, it’s incredibly difficult for a new home buyer to save up even ten or twenty thousand dollars to make a deposit on a small, cheap property. FHA loans in Texas allow potential buyers to build equity over time with a larger loan that covers these initial expenses.

Conventional loans require large down payments that very few potential buyers can afford. This is particularly true for young, first-time buyers. Conventional loans come with higher closing costs, too, which require money the buyer could otherwise have used to build equity. Since FHA loans have low closing costs, they allow buyers to get a jumpstart on equity building. Between the two types of loans, it’s easy to see why so many buyers choose FHA loans to purchase houses.

Differences in PMI

Most problems with FHA loans in Texas begin once the borrower realizes they cannot get rid of PMI (Private Mortgage Insurance). This monthly charge depends on the size of the down payment, the size of the loan, the borrower’s credit, and more. Large or small, however, it’s always a frustrating cost that does nothing to build equity.

PMI protects lenders from potential defaults and failure to make payments. It is essentially a safety net that allows lenders to offer options like FHA loans in Texas to borrowers who would not qualify for conventional loans. It makes a risky loan much more appealing to the lender. So, they are willing to offer more of them. However, FHA and VA lenders cannot waive PMI fees. It doesn’t matter if borrowers have a proven track record of successful, timely payments.

Conventional loans allow borrowers to essentially grow out of these monthly dues. In fact, the law requires conventional lenders to send borrowers written notice when they are able to opt out of PMI. If the borrower chooses, they can continue paying it, but very few do. Most would rather use that money to pay off their loan faster. This scenario leads many FHA borrowers to refinance with a conventional loan once they are able.

There’s nothing wrong with using the complex mortgage market to your best advantage. The lenders will get their dues one way or another, but there’s no reason to pay PMI if you don’t have to. FHA loans are a great way to get a home. Refinancing with conventional loans may allow you to build equity faster.

 

 

 

Why Realtors Should Always Accept VA Contracts

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VA loans are a great opportunity for realtors on both sides of a contract negotiation. These loans give the buyer more opportunities, which means sellers have a better chance of attracting motivated bidders. Although the VA requires various restrictions that will bring more paperwork and demand extra considerations, these requirements can actually help both the buyer and the agent in the long run. A minor inconvenience is no reason to overlook the many benefits of a VA loan.

Higher Home Standards

A huge benefit for realtors working with clients approved for VA loans is that they can examine better homes. The VA has very strict standards that homes must meet in order to qualify for the loan. Many of the VA’s safety upgrades are revealed during the official appraisal. This gives the buyers a lot of leverage during negotiations with the owners. VA loans are reliable, and traditional funding often falls apart at the last minute.

Sellers are motivated to sell, so if their buyers – who come with very reliable funding – can only go through with the process once a few, small upgrades are made, then they’ll usually agree. They may ask slightly more from the buyer, but careful negotiations can give the buyer an advantage. Any terms in the negotiation linked to funding carry more weight for both sides, which means both sides are willing to meet those terms. This benefits the buyers, the sellers, and the realtor or realtors involved.

A Larger Pool of Better-Funded Buyers

This point benefits both buyers’ and sellers’ agents. In today’s market, many potential buyers have the financial ability to pay a mortgage and maintain a home, but they cannot gather the thousands of dollars needed for a down payment. VA loans allow these buyers to purchase a home without waiting another two or three decades. This gives sellers’ agents a better range of buyers to compete for their clients’ properties. It also gives buyers’ agents more potential clients who are ready to do more than just look.

Since buyers don’t have to pay a down payment, they often have a wider budget. This gives financial wiggle room and lends clients the ability to consider slightly more expensive properties. Naturally, this is better for buyers’ agents in particular, but it can also help sellers and their agents. For example, if a buyer is particularly motivated to purchase a property, but he has competition, he can bid higher. The only restriction is the appraisal estimate.

The VA is for veterans, and apart from the benefits described above, accepting VA contracts is about supporting our troops. These loans support the economy while simultaneously helping servicemen and their families find homes. Realtors representing both parties enjoy huge advantages, such as reliably-funded clients and more financial flexibility. Conforming the VA’s procedures and filling out some extra paperwork is well worth the effort. VA loans help buyers, sellers, and real estate agents alike.

 

Improve Your Term, Lower Payments, and Reduce Rates with FHA Streamline Refinance

Improve Your Term, Lower Payments, and Reduce Rates with FHA Streamline Refinance

If you have an FHA mortgage and your financial situation has changed, you probably gave up hope of refinancing. Look into FHA Streamline Refinance options. They use your existing borrowing relationship with the FHA to benefit all parties. You can refinance for a longer term, lower payments, and even reduced rates.

What is FHA Streamline Refinance?

This refinancing program helps borrows with FHA mortgages improve their finances by offering more borrower-friendly options. Essentially, homeowners trade an older FHA loan with unfavorable terms for a newer mortgage that better suits their needs. There are options for various financial situations, including a five-year adjustable rate mortgage and some fixed rate refinancing options with various terms. Although the details of FHA mortgages change frequently, these are the details as of October 2017.

Many homeowners with unfavorable FHA mortgages can’t refinance through traditional loans due to stringent qualifications. Unlike traditional loans, an FHA Streamline Refinance loan does not require proof of income or employment. There are very few credit requirements, and potential borrowers don’t need to surrender information about their assets or have their homes appraised.

Why the System Works for Everyone

The economy has changed a lot over the years, and this program is designed to help your original lender recover their investment without driving you, the borrower, into financial ruin. This helps both sides of the equation, and since the FHA backs both the original mortgage and the refinancing option, they don’t assume the extra risk. They only increase their chances of getting their money back in full. After all, a short sale or foreclosure ultimately costs all parties. For maximum profit, the lender needs borrowers to pay back their mortgage in full.

How It Can Help Your Situation

We already discussed how FHA Streamline Refinance options demand fewer requirements from FHA mortgage holders. It’s hard to understate how important this is for borrowers. Traditional lenders simply will not refinance a loan when the borrower is having employment difficulties, holds little to no savings, or if the house has lost significant value. Depending on where and when you bought your house, you probably paid more for it than it is worth now, especially if you bought it new. Removing these roadblocks makes refinancing possible.

The range of refinancing options under the program allows you to match your income and realistic financial situation to a new mortgage. If you need a longer term with lower payments, you can find a fitting refinancing option. If you want to get better rates, you can cut your long-term interest costs so you can begin building your savings again.

Life is full of surprises, but that doesn’t mean you have to give up on your dreams. These special refinancing options through the FHA allow you to keep your home and solve the most problematic aspects of your current mortgage. You can set a new term so you have the time you need to recover from a disaster. Lower payments and reduced rates are available to those who qualify.

5 Things Before Applying for an FHA

Consider these 5 important things before applying for FHA home loans in Texas

If you are a resident of Texas, and you are looking for buying a home, the Federal Housing Administration (FHA) which is a part of Housing and Urban Development (HUD) that has made available some provisions for not only First-time home buyers but senior citizens and mobile home owners as well.  This branch of government has insured the loans so that the lenders can offer comparatively better rates on mortgage financing. The FHA loan assistance programs in Texas also comes with some great options for the people who need extra financial help of low down payment, low closing costs and easier credit qualifications and eligibility criteria.

There are basically five most important things you should consider before applying for FHA home loans in Texas. They are as follows:

1. Low Down Payments in FHA home loans in Texas

Unlike VA mortgage loans in Texas, the FHA requires a down payment of at least 3.5 %. This is comparatively much less than the conventional mortgages, which might require down payment ranging from 5 % to 20%.
The large down payments of conventional loans make them unattainable for many would-be buyers. That is the reason why FHA loans in Texas are much preferred by the home-buyers.

2. FHA Loan in Texas

Since more than eighty years, The FHA and its loans have helped over 34 million people in the USA to become homeowners. The mortgage insurance program of FHA allows the loan lenders to ease their eligibility requirements and make homeownership easily accessible for the people in the neighborhood across the country, especially in Texas.

Unlike VA home loans in Texas, the FHA’s loan insurance allows the lenders to know that they’ll be paid back if a borrower defaults. That effectively reduces their risk, at the same time, enables them to lend the housing loan more liberally.

Here are some conditions that need to be considered and fulfilled so as to avail the housing mortgage which would help to answer some of your questions about the eligibility for a borrower to have an FHA purchase loan.  


3. Eligibility Overview for FHA Loans in Texas


To avail the facility of borrowing FHA loan in Texas, the borrower must actually intend to occupy the home. So, the rentals or people applying for the mortgage for second homes generally don’t qualify. Other requirements include the condition that the home must be a 1 to 4 unit property.

These are the basic eligibility criteria which you would be required to fulfill, but certain other conditions that make you eligible for availing the loan are:

  • You are required to have a down payment of at least 3.5 %.
  • You are needed to qualify for the financing on the balance of the purchase price of the house.
  • You should be able to sustain the monthly payments which include the FHA loan insurance premium.
  • You are also required to have a steady employment history.
  • You are required to have established a clean credit history
  • The property should be appraised by the FHA-approved appraiser

 

4. The Property Types that allow you to avail FHA loans

Many property types are eligible for FHA mortgage loans; however, you are required to shift in within 60 days. There are various property types which make you eligible for the FHA loans as follows:

  • Single-family homes
  • Multi-unit properties
  • Townhomes
  • Manufactured homes
  • Condominiums

 

5. The Required Documents which would fulfill the eligibility criteria

The documents which would make you avail the facility of borrowing FHA loan before buying a house are:

  • Evidence of residence for the past two years
  • Gross monthly income at current employer
  • History of past two years of employment
  • Social Security card
  • Bank account information
  • Information on any other owned real estate
  • Information on all active loans
  • Approximate value of all the personal property owned by the borrower
  • Current paycheck stubs
  • Past two years of W-2 forms
  • Past two years of personal tax returns