Category Archives: California FHA Loans

FHA Energy Efficient Mortgage Program (EEM)

FHA Energy Efficient Mortgage Program

FHA Energy Efficient Mortgage program (EEM) helps families save money on their utility bills by allowing home buyers and homeowners to finance energy efficient improvements with their FHA insured mortgage.

energy efficient mortgageThe Energy Efficient Mortgage program was created after recognizing that an energy-efficient home will have lower operating costs, making it more affordable for the homeowners.  Cost-effective energy improvements can lower utility bills and make more income available for the mortgage payment.

Creators of the FHA Energy Efficient Mortgage Program recognized that a reduction in utility expenses can permit a homeowner to pay a higher mortgage to cover the cost of the energy improvements on top of the approved mortgage.

Under its Energy efficient mortgage program, FHA Insures a borrower’s mortgage used to purchase or refinance a principal residence, and the cost of energy efficient improvements to be made to the home. The borrower does need to qualify for the loan amount used to purchase or refinance a home.  The borrower is not required to be qualified on the total loan amount with the portion of loan used to finance energy efficient improvements. Like all FHA insured mortgages, the loan is processed, approved, and funded by a lending institution, such as a mortgage company, bank, or savings and loan association.  FHA does not lend money, the Federal Housing Authority only insures the loans to protect the lender against loss in the event of payment default.

Energy Efficient Mortgages are one of many FHA programs that insure mortgage loans–and thus encourage lenders to make mortgage credit available to borrowers who would not otherwise qualify for conventional loans on affordable terms (such as first time homebuyers) and to residents of disadvantaged neighborhoods (where mortgages may be hard to get).

EEM can also be used with the FHA Section 203(k) rehabilitation program and generally follows that program’s financing guidelines. For energy efficient housing rehabilitation activities that do not also require buying or refinancing the property, borrowers may also consider HUD’s Title I Home Improvement Loan program.

HUD

 

FHA Reverse Mortgage

FHA Reverse Mortgage

FHA Reverse Mortgage is a loan specially designed for homeowners 62 years and older.  The FHA reverse mortgage is also referred to as a home equity conversion mortgage (HECM).  The HECM mortgages are insured by FHA (Federal Housing Administration) so the loans are guaranteed by the government for the borrower’s assurance and protection.   With this type of loan, no monthly mortgage payments are required. The homeowner is allowed to use the equity in their home to obtain a loan that does not have to be paid back until the homeowner moves, sells, or passes away.   The homeowner is still responsible for their own property taxes and homeowners insurance.

FHA Reverse MortgageBecause of the amount of reverse mortgage loan defaults in previous years, new guidelines were imposed in April, 2015.  The new rules were created to prevent loan defaults and they require a borrower(s) to pass a financial assessment prior to being approved for their reverse mortgage.

The new financial assessment rule requires borrowers to demonstrate the ability to pay their property taxes and property insurance.  Previously, only the equity was reviewed but now, lenders review the borrower’s income, tax returns and credit reports to evaluate the ability of meeting their financial obligations.

If a homeowner fails to pass the assessment, he may still be eligible to receive a reverse mortgage.  It is possible to set aside money in an escrowed account in order to pay the property taxes and insurance.  In some cases, the money set aside will make the loan impractical, but some homeowners can do a partial set aside.

While the new FHA Reverse Mortgage guidelines make obtaining the loans a bit more difficult, they were created to ensure the homeowner has the financial capacity to remain in their home for the rest of their lives.

If you have additional questions about a reverse mortgage or if you would like to discuss your options, complete the quick app at the side of the page and a loan counselor will contact you for your free consultation.  You may also send us an email to info@calfiorniafhaloans.com

California FHA Loans

California FHA Loans

California FHA loans make it easier for homebuyers with little to no money down or those with less than perfect credit to purchase a new home. Typical FHA loans require a minimal down payment of 3.5% but when combined with various other home buyer programs it is possible to purchase with only 1% down or less.

California FHA LoansTHE Federal Hosing Authority (FHA) has been insuring loans since 1934.  By backing or insuring the loans, the FHA program allows lenders to provide mortgages with lower down payments, lower closing costs, and easier credit requirements.

There are California FHA loans available for borrowers that fall within a wide range of credit criteria including scores as low as 580 and home buyers who have experienced previous bankruptcies, foreclosures, or even short sales.  Alternative credit may be used for applicants that do not have established traditional credit.  Alternative credit may be in the form of utility bill history, proof of rental income, and private loan ledgers.  FHA loans are available for single family residences as well as condos, townhomes, and there are programs for mobile homes and manufactured homes.  There is an FHA loan program for home buyers purchasing a manufactured or mobile home on land and another for homebuyers purchasing a mobile or manufactured home in a park.

FHA Energy Efficient Mortgage Program allows California home buyers to finance the costs of making their new home more energy efficient.

Borrowers 62 years and above may take advantage of the reverse mortgage program for either tapping into their current home equity or purchasing a homes with a substantial down payment and no additional payments for as long as they live in the dwelling.   For additional information on California FHA loans, complete the short information form and a loan counselor will contact you to answer all of your questions.

 

 

 

 

 

 

 

 

California Housing Finance Agency

FHA Loan Limits California

FHA loan limits vary for each California County. The FHA Loan Limits are set by HUD, and they are recalculated on an annual basis.   The limits are based on a percentage calculation of the nation FHA loan limitsconforming loan limit.   The 1 unit (single family) limits are calculated by factoring in the median price value of homes within the specific county.

Depending on those limits, FHA’s minimum national loan limit “floor” is at 65% of the national conforming loan limit. The floor applies to those areas where 115% of the median home price is less than 65% of the national conforming loan limit.

On the higher end of the scale, any area where the loan limit exceeds the “floor” is considered a high cost area. The maximum FHA national loan limit “ceiling” is at 150% of the national conforming limit. In areas where 115% of the median home price (of the highest cost county) exceeds 150% of the conforming loan limit, the FHA loan limits remain at 150% of the conforming loan limit.

Areas are eligible for FHA loan limits above the national standard limit, and up to the national ceiling level, based on that particular area’s median area home prices.   Several California counties are considered high cost areas, and the loan limits in those counties are current set at the ceiling loan limit.

 

County,FHA Loan Limit

Alameda,$ 625000
Orange ,$ 625500
Alpine,$ 463450
Placer,$ 474950
Amador,$ 417000
Plumas,$ 417000
Butte,$ 417000
Riverside,$ 417000
Calaveras,$ 417000
Sacramento,$ 474950
Colusa,$ 417000
San Benito,$ 625500
Contra Costa,$ 625000
San Bernardino,$ 417000
Del Norte,$ 417000
San Diego,$ 546250
El Dorado,$ 474950
San Francisco,$ 625500
Fresno,$ 417000
San Joaquin,$ 417000
Glenn,$ 417000
San Luis Obispo,$ 561200
Humboldt,$ 417000
San Mateo,$ 625500
Imperial,$ 417000
Santa Barbara,$ 603750
Inyo,$ 417000
Santa Clara,$ 625500
Kern,$ 417000
Santa Cruz,$ 625500
Kings,$ 417000
Shasta,$ 417000
Lake,$ 417000
Sierra,$ 417000
Lassen,$ 417000
Siskiyou,$ 417000
Los Angeles,$ 625500
Solano,$ 417000
Madera,$ 417000
Sonoma,$ 520950
Marin,$ 625500
Stanislaus,$ 417000
Mariposa,$ 417000
Sutter,$ 417000
Mendocino,$ 417000
Tehama,$ 417000
Merced,$ 417000
Trinity,$ 417000
Modoc,$ 417000
Tulare,$ 417000
Mono,$ 529000
Tuolumne,$ 417000
Monterey,$ 483000
Ventura,$ 598000
Napa,$ 592250
Yolo,$ 474950
Nevada,$ 477250
Yuba,$ 417000

 

HUD Website