FHA Handbook

FHA Handbook

Similar to conventional mortgages, FHA home loans are governed by a set of rules and guidelines that participating lenders must adhere to in order to be insured by the U.S. government. These rules are compiled in a reference book known as HUD 4000.1, or the Single Family Housing Policy Handbook (SF Handbook).

The SF Handbook contains the regulations for FHA loans, including guidelines for “forward mortgages,” which are intended for borrowers looking to purchase a house, condominium, townhome, manufactured home, and other property types. Additionally, the Handbook provides rules for FHA refinance loans and FHA “reverse mortgages” available to qualified borrowers aged 62 or older.

As a potential homebuyer exploring mortgage options, you must meet several requirements to qualify for a loan. Many of these guidelines are detailed in HUD 4000.1 and serve as a reference for FHA’s minimum credit standards, appraisal criteria, and more. However, it is important to recognize that state and federal laws, lender-specific standards, and other regulations may also come into play, in addition to those outlined in the FHA Handbook.

Identity Theft

Identity theft is a serious crime where someone steals your personal information, like your name and social security number, to commit fraud.

ARM

Adjustable-rate mortgages start with a low, fixed rate for a set time. After, the rate changes based on an index, so your payments may go up or down.

PMI

With conventional loans, you must pay for Private Mortgage Insurance (PMI). Lenders require it to protect against losses if a borrower defaults.

Eligibility

To qualify for an FHA mortgage or refinance, you must meet certain borrower criteria. The FHA program offers significant flexibility for eligibility.

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