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Mortgage Processing > FHA > Flashcards

FHA Flashcards

1
Q

Who can get an FHA loan?

A

First time homebuyers
Who has no credit or limited credit
Family with past problems
Low to moderate income families

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2
Q

What kind of properties are eligible for FHA loans?

A

Primary Residences

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3
Q

What is another name for a regular FHA Loan?

A

203b Program

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4
Q

Can a borrower obtain more than 1 FHA loan?

A

Under certain circumstances- is is more than 100 miles from previous residence; increased family size; leaving jointly owned property

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5
Q

What is the minimum down payment for FHA loans?

A

3.5%

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6
Q

What is the Upfront mortgage insurance premium?

A

1.75% premium of base loan amount

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7
Q

How is the monthly MIP calculated?

A

Depends on mortgage insurance factor

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8
Q

Can the MIP ever be dropped?

A

Not on LTVs above 90%

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9
Q

What is the max seller contribution?

A

6%

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10
Q

What products are allowed under the FHA?

A

Fixed rate of 15 and 30 years, and ARM Products; no temporary buy downs

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11
Q

What is the reserve requirement for FHA Loans?

A

1 month PITI for 1-2 units; 3 months PITI for 3-4 units

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12
Q

What are compensating factors for credit?

A

3 months PITI for 1-2 units, 5% housing payment increase and 12 month rental history; no discretionary debt; significant additional income not used in gross effective income

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13
Q

Is connection to public water and sewage required?

A

Yes, if it is feasible

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14
Q

What documents does the appraiser need prior to an appraisal of a new construction?

A

Plans and specs, building permit, HUD 92531 builder’s cert, sales contract

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15
Q

What documents are required for the appraisal of a new construction?

A

HUD 92544 completion of construction, Certificate of occupancy, NPMA 99 termite treatment, Manufactuer guarantees, carpet identification, insulation certificate

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16
Q

How long must personal funds be in borrower’s account?

A

60 days

17
Q

How much can non-taxable (social security, unemployment, child support, etc) income be grossed up?

A

15%

18
Q

If income is expected when must it go into effect?

A

Within 60 days

19
Q

What is the minimum credit score for FHA?

A

500

20
Q

When no credit history is available, are utility payments, rental payments, etc. acceptable?

A

yes

21
Q

How long after Chapter 7 and 13 bankruptcies must pass?

A

2 years

22
Q

How long after foreclosure?

A

3 years

23
Q

What is CAIVRS and what does it do?

A

Credit Alert Verification System; sees if borrower is delinquent or has claim paid

24
Q

Why do borrowers refinance OUT of FHA mortgages?

A

Because of the upfront and monthly premiums

25
Q

How much cash back can be received in an FHA refinance?

A

No more than $500

26
Q

What is a streamlined refinance?

A

FHA loans refinanced to another FHA loan; no cash out to borrower and P&I is lowered; no appraisal is required

Mortgage Processing (9 decks)

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