FHA Loan Assumption Process - How it works..

By
Real Estate Agent with Coldwell Banker Burnet - Associate Broker

My client who is selling their home has an FHA loan that is assumable.  How do we know if the new buyer can assume it?
 
Answer:
 
The current note holder/mortgagee needs to contact the Assumption call center at 800-340-0570 to request an Assumption package, which is essentially the package they would provide to the potential new home buyer of their home.
The new buyer must meet current FHA guidelines (600 min.score/ 41 back ratio, standard income/credit/qualifying), owner occupied only. Property is not underwritten, only the new borrower.
No minimum down payment is required, but if the seller has equity that he is entitled, the new borrower must find that money to pay him/her from their own/outside sources. Fees? Credit report, flood, and assumption fee (usually about $500) Plus title fees, but no ALTA is required.  Purchaser may want to purchase an owner's policy. Turn time?  45-60 days (min. 3 weeks).  The worse the credit, and the more disorganized and non-responsive the new borrower is to requested additional information or incomplete application/package, the longer it takes to close.
 

Knowing the value of FHA and the assumability of the loan is one of the most unique and valuable elements of the program!

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the printer to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase:

Topic:
Lending / Financial
Location:
Minnesota
Groups:
RE/MAX Active Rain Bloggers

Comments 5 New Comment

Anonymous
Post a Comment
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the pencil to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase:

Show All Comments
Ambassador
1,010,201
Harry F. D'Elia
Investor , Mentor, CSSN, Radio Coach, REOs, ABR
Precision Real Estate Inc.

Thanks for sharing your information with us today. Have a great weekend.

August 14, 2009 03:14 PM
Rainer
110,832
Charles Perkins
Charles G. Perkins, CPA

Great to know.  I rarely run across sellers with FHA loans unfortunately. 

August 14, 2009 03:18 PM
Rainer
22,433
Brian Anderson
SEO and Social Media Marketin
Peachtree SEO

Pete - nice post on assumptions.  Made me reminiscence about the old No Qualifying assumptions!

February 05, 2010 11:44 PM
Anonymous #4
Anonymous
Robert Kleven

Hi Pete...

I have a property listed that is an ideal candidate for marketing as an FHA assumption. I'm just now sure how to structure it to cover commissions closing costs etc.

October 20, 2010 12:32 PM
Anonymous #5
Anonymous
Paula

I co own a home with soon to be x boyfriend. i just found out when attempting to retrieve tax info online that his is the primary borrower. i called the bank and they said i would have to assume the mortgage to have his name removed. I dont understand how that works i have read on it but how much will it cost me. I paid the closing costs, monthly mortgage and ins, as well as all the house hold bills. He has not paid any payments in the last 2 1/2 years. now i have to pay more money to have my name be the only one on the house.

i know i cant afford a attorney to help figure this out and wells fargo is not being forthcoming about  the details, they just state 11$application fee, 508.$fee to them and county filing fees. i called origianl lender and they said i would have to have re appriased and inspected etc.. well that is a different story i dont want to re buy my house from myslef and go thru that hassle..

Looking for the chepest method possible with an assumption (non-qualifying assumption)?? but what does that mean i have the pay the equitable difference? uggghh..

January 18, 2013 08:31 AM
Anonymous
Post a Comment
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the folder to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase:

Show All Comments
Rainer
3,281

Pete Kiron

Ask me a question
*
*
*
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the woman to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase: