FHA and Deferred Student Loans

FHA and Deferred Student Loans

MortgageMack Here and today we’re going to discuss FHA and Your Student Loans.

FHA and Your Student Loans

FHA is a mortgage loan insured by the Federal Housing Administration that requires the borrower to pay mortgage insurance to insure the lender against default.  I just completed a Blog Post specific to the FHA purchase and refinance loan called FHA 203b.

Now, for many years, FHA has allowed for the lender to exclude student loan payments in their qualification analysis or what we call debt to income ratio…

if we could prove the student loan payments were deferred for at least 12 months from the day of closing.  But,

Today’s FHA requirement differentiate between deferred loans and student loans and we’re going to talk specifically about Student Loans debt.

FHA and Your Student LoansStudent Debt has Reached the Highest it has Ever been in our History.

The average Student Loan debt for the Class of 2017 was $39,400 per student.  The total amount owed by American students and their parents is $1.48 trillion spread among 44 million borrowers with a 90 plus days delinquency rate of 11.2%.*

Many economic professionals, I’ve listened to and spoken to over the past years have stated Student Debt is likely to be the next major US economic bubble.**

Now, I’ve had a couple of borrowers with an exceptional amount of total Student Loan obligations and FHA gives me 3 options for declaring that debt on the mortgage application which we’ll analyze now.

So, let’s define Student Debt.  FHA refers to Student Loans as a liability incurred for educational purposes.  Pretty simple?

FHA also, states all Student Loans owed by the borrower must be included as an active liability with the following requirements.

  1. If the payment used for the monthly obligation is: a) less than 1% of the outstanding balance reported on the credit report and b) less than the monthly payment reported on the Borrower’s credit report, the lender just obtains written documentation of the actual monthly payment, the status and evidence of balance and term: THEN
  2. Regardless of the payment status, the Lender must use either the GREATER of: a) 1 percent of the outstanding balance of the loan or b) the monthly payment reported on the credit report unless c) the actual documented payment provided is fully amortized to full term from beginning to end!

Now, as I stated before, I had client with an $80,000 Student Loan and according to the guidelines, I must use the the 1% which $800 and there was no payment reported on the credit report and even if there was and the payment was less than 1%, I still had to use the $800/mo. calculation.

Therefore, I asked my borrower to call the Creditor and request a full amortization schedule for her Student oan, which the servicer obliged and the payment was reduced to $319/mo.

Big difference from $800/mo., wouldn’t you agree?

So, if you have Student Loan debts and are afraid can’t qualify, call me or apply at www.mortgagemack.com and help you with a FREE analysis of your Student Loans.

Thank you for watching.  I welcome your questions and comments and please subscribe to www.teammortgagmack.com?

MortgageMack….OUT!

*Student Loan Statistics

**Student Loans Economic Bubble

 

FHA Mortgages Texas

FHA Mortgage Texas

MortgageMack Here.

Today we’re going to discuss FHA loans, specifically the FHA 203b program, FHA also offer disaster relief mortgages which you can find information about on my vBlog.

FHA Mortgages in Texas

FHA Mortgages in Texas – What is a FHA Home Loan?

An FHA loan is a mortgage that’s insured by the Federal Housing Administration (FHA). … However, borrowers must pay mortgage insurance premiums, which protects the lender if a borrower defaults. Borrowers can qualify for an FHA loan with a down payment as little as 3.5% for a credit score of 550 or higher with OneTrust Home Loans.

Benefits of a FHA Mortgage…

  • Low down payment of 3.5% and you do not have to be a first time home buyer or meet income limits as FannieMae requires for their 3% down program
  • The minimum credit score with OneTrust Home Loans is 550 subject to approval wherein the minimum score for a conventional loan is 620
  • FHA will allow for a person to currently be in a Chapter 13 BK as long as they can prove on time payments to the courts for 12 months in accordance with their original BK plan and a letter from courts granting permission to enter to a mortgage transaction
  • Allows the seller to pay up to 6% of the sales price towards the buyer closings and pre-pays not to exceed the actual total of the closing costs and pre-pays wherein conventional will only allow 3% from the seller with 3 to 5% down payment
  • There are no income limits but the maximum mortgage for Harris County and the surrounding area is: $331,200 for a single family dwelling and higher for 2 to 4 unit residences
  • The debt to income ratio is much higher for FHA affording people the opportunity to buy more house. Subject to AUS approval, I’ve seen DTI up 57% approved and recently closed a transaction with a 57% DTI ratio wherein conventional is limited to 50%.

FHA Mortgages in Texas

So, those are some the benefits of FHA and the #1 reason folks might avoid FHA is the extra mortgage insurance costs relative to a conventional loan.  FHA’s has an upfront mortgage insurance premium of 1.75 and monthly, depending on down payment and length of the loan of as much as .85% and the monthly amount is permanent for the life of the loan.

Most owner don’t live in their home past 9 years, so I’m not sure the permanency of the monthly mortgage insurance is that big a deal.

In summary, FHA is great loan program that offers more opportunity to more folks who want to own a home.

If you or someone you know would be interested in knowing more about a FHA home loan, call me or email me at mack@onetrusthomeloans.com or go to www.mortgagemack.com to apply and please subscribe to my vBlog at www.teammortgagemack.com

I look forward to your questions and comments.

Thanks for watching and have a great day!  MortgageMack out

 

Houston Mortgage Company Donates To Harvey Hero

Houston Mortgage Company Donates To Harvey Hero

Houston, TX – OneTrust Home Loans a Houston Mortgage Company donates to a Harvey Hero $33,450 in home repairs to United States Marine Corps veteran Dexter Gasery for his heroic efforts during the Hurricane Harvey disaster.

Houston Mortgage Company Donates To Harvey Hero because Dexter Gasery put others before himself

During the disaster, Gasery went above and beyond to help his local neighbors. He rescued an elderly woman and her dogs from her home, escorted a family of five to the main road outside of the flooded Laura Koppe neighborhood, and coordinated efforts with police and firefighters to identify those that required medical attention amongst the sheltered at the local school. Gasery also assisted local authorities in combing the area to find those that needed rescue. During the search he discovered a mother and her 18-month old baby and brought them to safety.Houston Mortgage Company Donates To Harvey Hero

The donation will go towards rebuilding Gasery’s home, which experienced severe damage due to the hurricane. The OneTrust Home Loans leadership team, including CEO Josh Erskine, and contractors participating in the rebuild, visited Gasery’s home late last month to present the donation check.

Ian Milefchik, Mortgage Loan Originator at the Houston branch, presented Gasery to the OneTrust Home Loans executive team as a nominee for the company’s Hurricane Harvey Hero program. Milefchik helped Gasery purchase his first home in the summer of 2016. After seeing a post shared by Gasery on social media, Milefchik reached out to offer a lending hand to salvage whatever was left of Gasery’s home. Shocked at the level of devastation Gasery’s home endured, Milefchik recalled how excited Gasery was when he first purchased the home. After witnessing Gasery’s grateful attitude at being able to have helped others during the hurricane, Milefchik was compelled to find a way to help Gasery rebuild his home and nominated him for the program.

About OneTrust Home Loans

OneTrust Home Loans is a privately-owned direct lender with sales and operations across the country. The mortgage lender provides an array of loan options including Conventional, FHA, VA, USDA, Jumbo and more. OneTrust Home Loans places special importance on customer service as evidenced by their tagline, Service is Everything!® For additional information visit www.OneTrustHomeLoans.com.

Home Loan Approval

Home Loan Approval vs. Pre-Qualified Applicant

 

Hi. It’s Mack with One Trust Home Loans and thanks for being here. My NMLS number is 208691. And today, we’re going to talk briefly about being pre-qualified verses a home loan approval. You know, we find ourselves in a very tight inventory for houses that are for sale. It is very competitive out there. If you’re a first-time home buyer, it can be very challenging to find a home not only in your price range, but when you do, you find that you’re competing with other buyers.

Having a Home Loan Approval gives Buyers an Edge over Other Pre-Qualified Applicants

One thing that I know that will give first-time home buyers an edge in the market and even, you know, move-up buyers is to be pre-approved versus just pre-qualified. Now, in my 25-year career, the process for most home buyers starts with a pre-qualification wherein, you apply online or you apply in person, and we spend some quality time together, and discuss your goals. And we make sure that those goals are achievable based upon the income, the assets and make sure that the goals are achievable even within the framework of what you define for us with regards to your specific goals for down payment, closing costs and monthly payment.Loan Approval Process

Loan Approval Process Documents

Now, the home loan approval process takes the pre-qualification process several steps further. So, not only do we complete the loan the application,

Having A Home Loan Approval vs. Pre-Qualifed Applicantspend some time together and define your goals, but then we also put together the financial documents that are necessary to support the application, which include your W-2s for the most recent 2 years, pay stubs equal to 1 month’s income, 2 years tax returns, 2 months bank statements, appropriate identification, and some other items.  You can find a link with an approval checklist here on my video blog.

Now, what we do with that information is we not only just— Not only do we take and review it, but we submit your financial documents to an underwriter and request that the underwriter give us a pre-approval. And then we issue a pre-approval letter to you. And that letter in and of itself in a competitive situation where you are competing with other buyers can  make a difference in whether you get the property versus another person that didn’t take the process, that extra step to reassure a seller that you are indeed qualified to purchase a home.

I hope this was helpful. Please leave a comment and please tell us if there’s any of the material that you think would be of value to you that you would like to know more about. I’d be glad to share it with you. Thanks a lot.

FREE Guide To Your Dream Home

Free Guide to Your Dream Home

Our FREE Ultimate Guide to Your Dream Home will help educate and empower buyers to make smart decisions when navigating the home buying process. We recommend starting with our Free Guide to Home ownership where we’ll guide you through 9 steps towards a successful home buying process.

Free Guide to Your Dream Home takes You Step by Step

  1. Examine Your Financial Situation
  2. Get Pre-Approved
  3. Dream-up Your Dream Home
  4. Finding The Right Real Estate Agent
  5. Making An Offer On Your Dream Home
  6. The Home Loan Process
  7. Get A Home Inspection
  8. Closing
  9. Moving Into Your Home

We start with the process of self-examination of your existing finances by beginning with a budget to help assess changes and preparations needed to insure affordability. You’ll find a budget worksheet along with links to Credit Karma and FREE Annual Credit Report for a quick peek at your credit.

Next, we review the importance of having your loan approved in advance along with a Dream Home Checklist to help nail the right home to meet your wants and needs.FREE Guide to Your Dream Home

In addition, you’ll discover how your Real Estate Agent works for you,  the importance of the home inspection, closing on your loan, moving, home inspections to the all important, Do’s and Don’ts during the loan process.  All this and more in one simple and easy to read, downloadable guide.

Click Here for Your FREE Copy

Calcon Morggage LLC, dba OneTrust Home Loans is an equal housing lender; NMLS #46375:  3131 Camino Del Rio North Suite 1680, San Diego, CA 92108.  Corporate phone (888) 488-3807.  For more licensing information visit:  https://onetrusthomeloans.com/licensing-information/.  All products are not available in all states.  All options are not available on all programs.  All programs are subject to borrower and property qualifications.  Rates, terms and conditions are subject to change without notice.

Mack F. Blankenship is a Mortgage Loan Officer at Onetrust Home Loans, 1345 Campbell Rd., #222, Houston, TX 77055.  Phone:  (346) 223—0336; NMLS #208691:  https://www.facebook.com/mortgeagemack/

Equal Housing Lender