What Are the FHA Loan Requirements for 2021?

FHA loan applicationFederal Housing Administration (FHA) loans are a government-insurance mortgage product offered to qualified borrowers across the country. These loans, which are offered by private lenders and secured by the FHA, may make homeownership more accessible and affordable. This is especially true for borrowers with lower credit scores or a smaller down payment contribution. If you’re considering an FHA loan for your next home purchase, there are a few personal and property requirements to keep in mind first. Consider working with a financial advisor as you weigh your options for getting a mortgage.

Requirements for the Property

Knowing the FHA loan requirements can help ensure that you are eligible to take out one of these government-insured loans before you even apply. In order to qualify for an FHA loan, the home must be your primary property. It can be a single-family home or a multi-family property with up to four total units. FHA loans are also available on manufactured and mobile homes, whether or not you own the land it’s on.

Prior to closing on an FHA loan, each home will need to pass an FHA inspection and appraisal. This can help identify any hidden or potential issues within the property. It also provides all parties with an accurate market value of the home.

FHA Loan Limits

The maximum FHA mortgage loan you can take out depends on the type of home you’re buying as well as your location.

In calendar year 2021, FHA mortgage loan maximums for single-unit properties can range from $356,362 and $822,375. When it comes to Home Equity Conversion Mortgages (HECMs) for eligible seniors, the FHA loan maximum is $822,375 for all areas of the country.

FHA Loan Requirements Credit Score and Down Payment

Asian couple checking to see if their FHA loan application was approved

To qualify for an FHA loan, borrowers need to have a FICO credit score of at least 500. With a 500 credit score, borrowers can take out an FHA loan with as little as 10% down. If you’re interested in a smaller down payment amount — putting down as little as 3.5% on the new loan — the minimum FICO credit score required is 580.

It’s important to note that even though the FHA has minimum credit score requirements of just 500 and 580, the individual lenders that actually offer the mortgage loans are able to set higher thresholds. This means that you could, for example, find an FHA lender with a credit score requirement well into the 600s. You would need to meet this requirement in order to take out an FHA loan through that lender.

Employment and Income

There are no specific income or employment requirements in order to qualify for an FHA loan. However, lenders will look at these factors when determining whether you’re reasonably able to repay a mortgage loan.

With that said, lenders will verify applicants’ employment over the previous two years. Applicants will be expected to explain any gaps in employment (one or more months) that occurred during that time. Lenders may also request additional employment records and verification of training or education. In some cases, they can even request an employer’s confirmation that you are being offered continued employment.

FHA Loan Debt Ratio Limits

In order to qualify for an FHA loan, you’ll need to meet certain limits regarding your debts. First, there is a maximum monthly housing expenses ratio limit of 31% of your gross monthly income. The category of housing expenses includes rent or mortgage, insurance, property taxes etc.

Then, there is a debt-to-income (DTI) limit of 43%. This means that your total debt burden (minimum monthly payments on loans, credit card balances etc.) cannot exceed 43% of your gross monthly income.

The Bottom Line

House key

An FHA-insured mortgage loan can make homeownership more accessible for borrowers with small down payments or lower credit scores at the time of application. While these loans enable private lenders to take on higher-risk borrowers, there are still important requirements in order to qualify. Additionally, borrowers should remember that lenders can also set their own requirements. In some cases, these may be more stringent than those imposed by the FHA.

Mortgage Tips

  • Not sure how best to seek a mortgage? A financial advisor can offer valuable guidance. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • Use our free mortgage calculator to find out how much house you can really afford.

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Debt After Death: 9 Things You Need to Know

An older man sits at a table on a laptop, surrounded by lush greenery.

DISCLAIMER. The information provided in this article does not, and is not intended to be, legal, financial or credit advice; instead, it is for general informational purposes only. 

Losing a loved one is hard on so many levels. Funeral arrangements and estate matters have to be dealt with in the midst of grief—and questions abound. What debts are forgiven at death, for instance? Can your family members’ creditors come after you now?

Technically, personal debts aren’t forgiven at death. Instead, they pass to the estate of the deceased person. We’ll explore what that means in practice in this post—and we’ll answer a few other questions along the way. The laws and rules can vary greatly from state to state, it is important to consult an attorney to help you navigate the process of how to handle the debts of a loved one after they have passed.

What Happens to Debt When You Die?

Personal debts created by the borrower themselves with no cosigning parties usually pass straight to the estate—unless the decedent was married and lived in a community property state. (We’ll cover what happens to debt in community property states a little later.)

Jointly held debts are a little different. Several different types of joint debt pass straight to cosigners without going through probate. Let’s take a closer look at five different types of debt to see what might occur after the primary borrower passes away.

Mortgage Debt

Joint mortgages pass directly to co-borrowers, who become responsible for the loan. Mortgages held by one borrower—i.e., the decedent—pass to listed beneficiaries, who then become responsible for the loan. If beneficiaries can’t or won’t assume the loan, they can sell the property to settle the debt instead.

If your loved one doesn’t have any beneficiaries listed on their will when they die, their mortgaged property may go into foreclosure. At that point, their bank will sell the property to recover the mortgage debt.

Car Loan Debt

Car loans held in joint names generally pass straight to the other borrower. If there is no cosigner and the estate is able to pay off the existing car loan, it will do so and then pass the car to the listed heir. If the estate cannot pay off the loan, the person who inherits the car can sell it to cover the debt. If you qualify for a car loan or you can pay their loan off in full, on the other hand, you can keep the vehicle. If no one is able to pay off the loan, the lender may repossess it.

Credit Card Debt 

Joint credit card debt passes straight to the other borrower. Credit cards with authorized users on them are different, however—unlike cosigners, authorized users aren’t responsible for debts. 

If your family member passes away with outstanding credit card debt, the lender may try to recover the debt from their estate. If there isn’t enough money left in the estate to cover those revolving debts, they’re usually simply written off. 

Student Loan Debt

Federal student loans and PLUS loans get discharged if borrowers pass away. Private student loans behave much like any other type of personal loan—if cosigners are involved, they’ll be liable for the debt. If there are no cosigners, student loan debt must be paid by the decedent’s estate—sometimes immediately.

Medical Debt

Medical debt can be more difficult to understand than other types of debt. If your family member died with medical debt, you may want to speak with a lawyer to understand what you are responsible for. For example, under a legal rule called the Doctrine of Necessities, in some areas, you may be responsible for your spouse’s medical debts if they are considered “necessary” expenses. This is true even if the bills are only in your spouse’s name and you did not sign for them.  Another exception would be in the case of a child—the child’s parents would remain responsible for the medical debt.

Many small medical debts are discharged when patients die. Larger medical debts, like other substantial debts, may become the responsibility of the deceased person’s estate.

9 Things to Know About Debt After Death

Assuming an estate is available to pay your loved one’s debts, here are ten things to know about debt after death.

These are the 9 things you need to know about debt after death.
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1. The Executor of the Estate Deals with the Debt

After your loved one passes away, direct any debt-related correspondence to the executor of their estate. As soon as the person dies, their estate is born—and along with it, an estate executor. Some people name executors before they pass away, but in other circumstances, executors are appointed by the courts.

Executors handle all financial issues relating to the deceased person’s estate, including debt payments. If you receive any unexpected mail from your loved one’s creditors, let the executor know right away.

2. Notify Creditors and Credit Bureaus

Creditors and credit bureaus need to know about your loved one’s death as soon as possible. This is another job for the executor of the estate. Here’s what the executor needs to do:

  • Notify all three credit bureaus—Equifax, Experian, and TransUnion—about the death, and ask that they place a “Deceased: Do not issue credit” notice on the person’s file to prevent identity theft.
  • Obtain a copy of the deceased person’s credit report to see what type of obligations they had.
  • Contact all the deceased person’s creditors to let them know that the individual has died.
  • Contact the Social Security Administration to make sure they note the person’s death.
  • Send copies of the deceased person’s death certificate to all three credit bureaus at the following addresses via certified mail:

P.O. Box 2000
Chester, PA 19022

P.O. Box 2002
Allen, TX 75013

P.O. Box 740260
Atlanta, GA 30374

3. Find Out Who’s Responsible

Before proceeding any further, make sure cosigners and joint borrowers are aware of your loved one’s death. Remember—responsibility for mortgages, credit cards, student loans, and other joint debts automatically pass to the surviving account holder. Joint responsibility doesn’t apply to additional cardholders or authorized users.

4. Stop Using Credit Accounts

Additional cardholders and authorized users must not charge anything new to the decedent’s accounts. Continuing to use cards associated with the deceased person after being informed of the person’s death could be considered fraud. At this stage, authorized users should apply for their own cards.

5. Keep the Estate Intact

Don’t distribute valuable possessions like jewelry and antiques yet. Settle debts first, and share any remaining physical assets afterwards. If you do distribute assets before sorting out debts, beneficiaries may end up being liable for those debts by proxy.

6. Negotiate with Creditors

If you’re a surviving partner and you’re having trouble paying joint debts after your spouse’s death, speak to your creditors. Many lenders are sympathetic and will work with you to ensure your credit stays intact. Explain your situation and tell them about any outstanding financial obligations and about any incoming life insurance money. 

7. Be Aware of Community Property States

In most states, surviving partners are not liable for their spouses’ personal debts. In community property states—Alaska (optional), Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin—however, they are. Surviving spouses in these states are responsible for their deceased partners’ debts, including any debts they didn’t know about. 

The community property stipulation only extends to debt accrued during the marriage. Debts accrued before the marriage are not community property debts. If you live in a community property state and need advice, contact a reputable probate attorney.

8. What Happens If There’s No Estate?

So, what happens to your debt if you die with no estate—or if your estate isn’t large enough to pay for it all? In short, the debt is written off. Without an estate to pay for it, it’s considered unrecoverable and is forgiven. 

9. If in Doubt, Contact an Attorney

We strive to provide information that’s accurate, but we’re not lawyers. If you’re confused and need advice, don’t hesitate to get in touch with a well-regarded consumer law or probate attorney. They’re not always cheap, but the service they provide can be priceless.

Preparing for Debts after Death

There are a couple of things you can do to make sure your outstanding debts are repaid quickly and efficiently after you pass away. First, create a clear legal will and name an executor. Then, consider bundling numerous small debts into one consolidation loan. Finally, think about buying a life insurance policy to cover any outstanding debts. All of these things can help make life easier for loved ones.

If you’re not sure how much you owe, sign up for ExtraCredit from Credit.com. The credit snapshot you receive can help you add up your financial obligations well before they become a burden.

Sign Up for ExtraCredit

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FHA Loan Requirements – Guideline & Limits

FHA loan requirements are simple; they’re different than conventional loan requirements. For a conventional loan, for example, you will need a good credit score. However a FHA loan credit score is only 580.

If you’re a first time home buyer and need a first time home buyer loan to purchase your dream home, then keep reading to find out how an FHA loan is right for you.

Click here to compare the rates if you’re thinking of applying for an FHA loan. It’s totally FREE.

In this article, we will cover several topics around the FHA loan requirements. As a first time home buyer, you will need to be aware of these requirements so that your home-buying process can go as smoothly as possible.

Here’s what we will cover: FHA loan limits, FHA loan rates, FHA loan credit score, FHA lenders, and so many others. In addition, we will address the difference between conventional loan requirements versus FHA loan requirements.

Click here to apply for a FHA loan.

FHA Loan Requirements – Guideline & Limits:

Buying a house through an FHA loan, while exciting, can be daunting, especially as a first time home buyer. Taking a few moments to familiarize yourself with the FHA loan requirements can save you from costly mistakes during the home buying process. Below is an overview of FHA loan process

FHA loan definition

What is an FHA loan? Simply stated, an FHA loan is a loan that is insured by the Federal Housing Administration. These type of loan are popular among first time home buyers because they allow them to put as low as 3.5% down payment and require a very low credit score.

So if you’re a first time home buyer with a bad credit, then an FHA loan makes more sense.

Feeling Overwhelmed With Your Finances?, You have options and there are steps you can take yourself. But if you feel you need a bit more guidance, simply speak with a financial advisorSmartAsset’s free tool matches you with fiduciary advisors in your area in 5 minutes. If you are ready to meet your goals, get started with Smart Asset today.

FHA loan limits

FHA loan limits refers to the maximum amount of loan the FHA will give you. For 2019, for example, in low cost areas, FHA loan requirements have been set in place allowing the maximum amount for a single family home to be $314, 827. Whereas for a four-plex, the maximum amount is $605,525.

FHA loan limits – low cost areas
Single Duplex Triplex Fourplex
$314,827 $403,125 $487,250 $605,525


For high cost areas, the FHA loan limits for a single family home is $726, 525 and for a duplex, the FHA limit is $930, 300. Those limits, of course vary depending on your states and they are update annually. So visit your state to determine what the FHA mortgage lending limits are.

FHA loan limits – high cost areas
Single Duplex Triplex Fourplex
$726,525 $930,300 $1,124,475 $1,397,400

Click here to compare current FHA loan mortgage rates

FHA loan vs conventional

When it comes to get a home loan for presumably the biggest purchase you’ll ever make in your life, you certainly have to know the key differences between an FHA loan and a conventional loan. While it’s easier to get approved for an FHA loan, it’s important so that you can make the best decisions.

FHA loan requirements

fha loan requirements
FHA credit score loan requirement

The FHA loan requirements are fairly simple and straightforward. Here’s what they require: 1) You must have a credit score of at least 580.

2) A 3.5% down payment is required. (*note, if your FICO score is between 500 and 579, then you will have to put 10% down payment). 3) You will have to pay Private Mortgage Insurance (PMI);

4) Your debt to income ratio must be < 43%. Your debt to income ratio is the percentage of your income that you spend on debt, including mortgage, car loan, student debt, etc..

5) The home you intend to purchase must be your primary residence. You must also occupy the property within 60 days of closing.

Click here to shop for FHA mortgage rates in your area

It can’t be an investment property. However, you can buy a duplex or triplex, live in one unit and rent the other units. As long as you reside in the property, you will satisfy that requirement. Also, the house must meet FHA loan limits (see above).

6) Finally, and of course, you must have a steady income and proof of employment. I will discuss later whether a FHA loan is better than a conventional loan. For more information about FHA loan requirements in general, visit the FHA website.

Conventional loan requirements

The requirements for a conventional loan, however, are much stricter. By the way a conventional loan or traditional loan is not insured by the Federal Housing Administration. But instead it is guaranteed by a private lender such as a bank, credit union, mortgage companies, etc…

Of course whether you will qualify for a conventional loan vary from lenders to lenders, but the following are required:

1) A credit score of at least 680 (of course the higher the score is, the more likely you will get qualified, and the lower your interest rate on the loan will be.

2) A down payment of at least 20% of the house purchase price. If you have less than 20%, you still can get the loan. But the problem is, you will have to take out private mortgage insurance, pay its premiums until you achieve at least 20% equity in the house.

3) Your debt to income ratio needs to be around 36% and no more than 43%.

Should you apply for an FHA loan or conventional loan?

As you can see above, the FHA loan requirements are less strict than the conventional loan requirements. However, which one you choose to apply to depends on your personal circumstances.

But if you are a first time home buyer, there are a lot of good reasons why an FHA loan would seem more appealing to you. For one, the down payment is only 3.5% (compare that with a 20% down payment a conventional loan requires). A down payment is the upfront money you need to to make when buying a home.

As a first time home buyer, saving for a 20% down payment on a house can be a big burden. Homes are expensive. For example, saving for $450,000 home can take you years to accomplish, especially if you have other debt like student debt, credit card debt, car loan, etc… So a 3.5% down payment makes it easier for you to buy your own home.

Second, the FHA loan credit score is only 580. Although, you should always take steps to raise your credit score, sometimes certain changes in your life may leave you with a low credit score. Perhaps, you had to file for bankruptcy which resulted in a low credit score.

Or maybe you never had a credit card, which means that you don’t have an established credit history. Or maybe you’re a victim of identity theft which lowered your credit score. So there are several reasons why you could have a low credit score.

However, that shouldn’t mean you can’t buy a house. That’s why the FHA loan requirements make it easier for folks who otherwise would not have been qualified for a conventional loan.

5 Signs You’re Not Ready To Buy A House

The Biggest Mistakes Millennials Make When Buying a House

How Much House Can I afford

Buy a home with the Right Financial Advisor

You can talk to a financial advisor who can review your finances and help you reach your goals. Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

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Bad Debt vs Good Debt

Bad Debt vs Good Debt

It’s almost impossible to get through life without taking on debt at some point or another. Between using student loans to go to college, taking out an auto loan for your first car or qualifying for a mortgage your first house, debt seems to be a part of most people’s lives. That’s not to say that you have to live with debt forever, but just you will likely be in debt at sometime.

Check out our mortgage calculator.

Unfortunately, it seems too many people have let debt become the norm and in general, people are no longer phased by carrying around a few thousand dollars of consumer debt or having student loan payments until they retire.

While having debt is never really a good thing (as in you owe someone money and are thus somewhat beholden to them), in the personal finance world, there are debts that are sometimes referred to as “good debts,” while others are considered to be “bad debt.”

In general, good debt is when you use it to buy something you need but can’t afford to pay for all at once, while bad debt is used to get something you don’t need and can’t afford. Good debt is also often associated with appreciating assets (things that go up in value) that add to your net worth. On the other hand, bad debt is often associated with depreciating assets (things that go down in value).

But sometimes figuring out the category for your debt and why can be confusing. Here are three types of debt commonly considered to be good debt and why:

Student Loans

The first debt many of us take on in our lives is student loan debt. Luckily, most people consider student loans to be good debt because taking on student loans to obtain a higher education often results in your landing a better career and therefore increasing your earning potential.

Try our student loan calculator.

It’s common knowledge that people with a college degree tend to earn more than those without a college degree, but what you decide to study can also have a huge effect on your earning potential. For people who study things that have a set career path, student loans may indeed be good debt and an investment into their future, but for those who choose to study something without many potential jobs, student loans may end up being just another payment they have to make each month. It’s a good idea to consider how long it will (likely) take you in your chosen field to pay off those student loans to see if it is really worth it.


Buying a home is often thought of as an exciting step toward becoming an adult, and for most that means taking on a mortgage. Mortgages are considered good debt because buying a house is usually seen as an investment. If the real estate market rises, you might be able to profit when you sell your home down the road. Plus, in the meantime real estate mortgage interest is tax deductible.

Business Debt

Starting your own business can be a very costly endeavor no matter what industry you are going into, and taking on business debt to start your own money-making operation is another form of good debt. Similar to student loans, business debt is supposed to be taken on to help you increase your future earning potential.

Bad Debt

Meanwhile, some examples of bad debt include credit card balances, auto loans and personal loans. These traditionally carry higher interest rates and so will cost you more in the long run. Sometimes you will hear (or read) people who don’t carry a balance on their credit card say (or write) that they are debt-free. Of course, if they have student loans or a mortgage, this isn’t technically true. But if you are prioritizing which debts to pay off first it is a good idea to start with the bad debt. Just keep in mind that all debt has to be paid back eventually!

Do you believe in good debt and bad debt? Why or why not?

Photo Credit: flickr

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Why You Should Buy Less House Than You Can Afford

When it comes to real estate, the more you spend, the more money everyone makes. And it happens on every level of your home purchase. The costs start adding up once you find the perfect place. According to the National Association of Realtors, real estate agents get paid by taking a percentage of the purchase price of your […]

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Source: thesimpledollar.com

Is LendingTree Legit, Safe or Scams?

If you’re asking yourself whether LendingTree is legit, you have every right to do so. After all, you’re about to take on a big financial obligation (whether it is a mortgage loan or a personal loan).

Your objective is to save money, so you want to find a lender with the best mortgage rate. But if you aren’t familiar with LendingTree, how do you know if it’s legit?

There are resources available to check, such as reading LendingTree reviews, to make sure if they are trustworthy.

When you’re looking for a mortgage lender you can trust, LendingTree is the right place for you. Just enter your information and get multiple free and free mortgage rates within minutes.

What is LendingTree?

Before answering the question of “is LendingTree Legit?,” you need to have an understanding of what LendingTree is.

Launched in 1998, LendingTree has built a reputation by matching borrowers to lenders. (For more information about the company, visit its website.

Instead of filling out several applications and talk to several lenders, with LendingTree you can shop around for the best mortgage loans on one website. It’s an all-in-one platform.

It just connects you with multiple lenders all at one time so you can compare and choose the best mortgage rates.

So in case you were wondering if LendingTree is a legitimate and trustworthy company, the answer is a resounding “yes.”

LendingTree is legit.

Related: LendingTree Review: Get a Loan in 10 minutes

Five Ways You Know LendingTree is a Legit and Trustworthy Company.

1. Read LendingTree reviews by their customers to see if it’s legit.

Part of your search “is LendingTree legit” should include reading customer reviews about their experiences with the company. Performing a simple Google search for “LendingTree Reviews,” then you will find a lot sites like consumeraffairs.com or trustpilot.com.

These reviews can help you determine if LendingTree is indeed legit. These reviews can give you the inside story on everything about LendingTree from customer service to interest rates.

One thing to keep in mind, however, is that happy customers are less likely to submit a review than unhappy ones.

So read these reviews with an open mind. Indeed, it’s important to look for reviews that are based on facts rather than opinions.

For example, a review that says “I like the lenders provided by LendingTree because their rates are low” is based on facts. A review that says “their service sucks” is based on opinion.

Shop and Compare Loan Offers in Rates in Minutes

2. Check LendingTree’s Better Business Bureau (BBB) rating.

Another way to know for sure if LendingTree is legit is to check its BBB rating. The BBB assigns business ratings from A+ to F.

A search for LendingTree’s BBB rating shows that not only it is an accredited company, but also has an A+ BBB rating. A BBB rating of A+ is the highest rating you can get. So if LendingTree has an A+ rating, you know it’s legit.

One thing to keep in mind is that BBB ratings and customer reviews can differ significantly. While a company like LendingTree may have negative reviews from customers (every company does), their BBB rating might be an A+.

3. Check LendingTree’s website.

Another way to know if LendingTree is legit is to thoroughly review its website. A company may seem genuine, but there are a few things that can throw up a red flag. Things to look for to see if LendingTree is a legit are:

  • How long have they been in business. According to both its website and the BBB website, LendingTree has been in business for 23 years.
  • Does it offer customer service? If there is no contact support, no address, no phone number to reach the company, this may be a red flag that the company is not legitimate. Fortunately, LendingTree’s homepage is full with that information. So there is no need to worry on that point.
  • See if LendingTree has a policy page: A legit company will have terms of use and conditions pages such as privacy policy pages. Again LendingTree does have this information, which can lead you to conclude it is legit.

Compare mortgage rates with LendingTree

4. Talk to family and friends about their experience with LendingTree.

Just like reading consumer reviews about LendingTree, friends, family members, colleagues are a great source to determine if LendingTree is legit. Ask them if their experience was satisfactory or not.

5. Visit a local office or a main office.

If you’re still not convincing that LendingTree is legit, visit a local office or their main office. Their main office is located at 11115 Rushmore Dr., Charlotte, NC 28277.

In conclusion, LendingTree is legit. But if you want to do your own research to determine if they are legitimate and trustworthy, do the following: check LendingTree’s reviews, their BBB rating, their website, and ask colleagues and friends about their experience with the platform.

All of these should lead you to believe that LendingTree is in fact a legit company.

Get Pre-Approved for a Mortgage Today

Work with the Right Financial Advisor

You can talk to a financial advisor who can review your finances and help you save 100k (whether you need it to pay off debt, to invest, to buy a house, or plan for retirement, saving, etc). Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

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Source: growthrapidly.com

11 Side Hustles That Can Make You Money

Passive income, for example, is a good way to make money while you sleep. The money you make from passive income isn’t tied to how many hours you work or how hard you try.

The post 11 Side Hustles That Can Make You Money appeared first on The Simple Dollar.

Source: thesimpledollar.com

How to Buy a HUD Home at the Hudhomestore Website?

Using the Hudhomestore to buy a HUD home is easy.

If you’re looking to buy a HUD home, the Hudhomestore website is the best place to do it. It can be found here at hudhomestore.com. HUD homes are listed for sale at the site.

While anyone can buy a HUD home, you will need to get approved for a loan first unless you can purchase your home with outright cash.

Just like buying a house through the conventional route, all financing options are available for HUD homes. That includes conventional loans, FHA loans, VA loans, etc.

However, most people used an FHA loan to buy a HUD home due to its low down payment and credit score requirements. In this article, we will go over all you need to know about buying a HUD home at the hudhomestore website.

If you have questions beyond buying a HUD home at the hudhomestore website, consult a financial advisor.

What is the Hudhomestore?

The hudhomestore is a website operated by the U.S Department of Housing and Urban Development (HUD). The website can be found here at hudhomestore.com.

Homes are listed there for sale after they have gone through foreclosures. Those homes are mostly single family homes and multifamily properties. Real estate agents and/or brokers can place bids on your behalf to buy a house.

What is a HUD home?

A HUD home (usually a 1 to 4 unit) is a property owned by HUD. Before a home became a HUD home, it was owned by a homebuyer who had purchased the home with an FHA loan.

Once the borrower stopped paying his or her FHA loan, the home went to foreclosures. Then the home goes to HUD and becomes a HUD home.

Why you should buy a HUD home at the Hudhomestore?

The benefits of buying a HUD home are huge. The main benefit is that most of these homes are priced below market value.

In addition, if you’re an EMS personnel, police officer, firefighter, or teachers, and live in revitalized areas and plan to live there for at least 36 months, HUD’s Good Neighbor Program offers HUD homes at a 50% discount.

This program is listed at the hudhomestore website at hudhomestore.com.

In addition, HUD offers other perks such as low down payment and sales allowances you can use to pay for moving, repair and closing costs. The low down payment, that is on top of the FHA financing that you may be qualified for.

Another huge benefit of buying a HUD home is that HUD gives preferences to buyers who intend to live in the home for at least one year. So this puts you ahead of investors.

Are you qualified to finance a HUD Home?

All financing options, including conventional loans, VA, and FHA loans, are available when it comes to buying a HUD home.

But FHA loans are very popular among first time home buyers, due to its low requirements. But before you start searching for HUD homes through the Hudhomestore website, you should compare multiple loan offers so you can the best mortgage rates.

FHA loan requirements:

  • 580 Minimum score
  • 3.5% down payment

If your credit score is below 580, you can still be qualified but you’ll have to pay at least 10% down. Or, you can always take time to raise your credit score.

Don’t know what your credit score is, visit CreditSesame.

Our Review of Credit Sesame.

Steps to buy a HUD Home at the HUDhomestore website:

HUD homes can be hard to find if you don’t know where to look. In other words, they are not listed on conventional real estate websites such as Zillow or Redfin.

Instead, they are listed at the HUDhomestore webiste, which can be found at hudhomestore.com. They also have HUD Homestore Mobile Apps.

Knowing these steps is important to mastering one of the best strategies to buy a house at below market or wholesale prices.

Step 1: Shop and compare home loans

Before you start searching your house through the hudhomestore site, it’s a good idea to

The worst thing that can happen is to find a house that you like to then realize that you cannot secure a home loan.

To get the best mortgage rates, you need to compare multiple loan offers. Buying a home is major expense, and getting the best rates could save you a lot of money. I can spend a lot of time talking about why it is a bad idea to only speak with one mortgage lender.

But when it comes to having multiple loan offers, I highly suggest LendingTree.

LendingTree is an online platform that connects you to several mortgage lenders without visiting a dozen bank branches.

LendingTree will provide you up to 5 loan offers from multiple lenders for free, so you can compare and make sure you get the best deal.

So if you’re at this step right now, go and compare current mortgage rates for free at LendingTree, and come back to this article.

Our LendingTree Review.

Step 2: Finding a HUD Home at the HUDhomestore website.

To find a HUD home, simply go to the hudhomestore website. It can be found at hudhomestore.com.

There are three ways to find HUD homes on the hudhomestore website. The first way is through a map.

Once you on the website, you will see a map to the right with all of the states listed there. You simply look for your state and click on it to see all of the available HUD homes.

The hudhomestore site will show you a list of all of the HUD homes available for that particular state. It will include the photo of the HUD home, the address, the asking price, etc.

If you click on the photo of the house, you will be able to see more information of the property, including more photos, street views and information of the property.

Another way to find a house through the hudhomestore website is by clicking on the HUD Special program links.

The hudhomestore site specifically lists three HUD Special Programs: Good Neighbor Next Door; Nonprofits; $1 Homes-Government Sales. It specifically states on the hudhomestore website that if you click on any of these special programs, you will see available properties.

The third way to find a HUD home via the hudhomestore site is through the Search Properties. At the middle of the homepage, you will see a Search Properties where you can enter more detailed criteria.

Step 3: Buy your HUD home

Once you have found your desired HUD Home at the hudhomestore, it’s time to buy your HUD home.

But note that HUD homes are sold through an auction process. When you’re searching for the property through the hudhomestore site, it will tell you a deadline by which to submit your offer.

So if the deadline has not passed, submit your bid. Once it has passed, HUD reviews all offers. Just like any auction, the highest bid wins. If all of the offers are too low, HUD will extend the offer period and/or lower the asking price.

Note that you will not be able to place the bid yourself. Only real estate agents need to register to place bids on the hudhomestore website. You will need to find a real estate agent or you can specifically search for HUD registered agents at hudhomestore.com.

For more information on buying a home through the hudhomestore website, visit www.hudhomestore.com.

What else can you do the hudhomestore site:

At HUDHomeStore.com, you can do several other things:

  1. You can search for qualified brokers to place your bids on HUD homes;
  2. If you are a broker, you can apply for NAID;
  3. You have access to various resources regarding HUD properties and the HUD purchase process;
  4. Read up on the latest news from HUD.

In conclusion, the hudhomestore is a website operated by the Government, specifically HUD (The Department of Housing and Home Development). At the site, you have access to both single family homes and multifamily properties. All of these HUD homes are listed for sale at a very low price.

More on Buying a Home:

  • How to Buy a House: A Complete Guide
  • How Long Does It Take To Buy A House?
  • Buying a Home for the First Time? Avoid These Mistakes.
  • 10 First Time Home Buyer Mistakes to Avoid.

Work with the Right Financial Advisor

If you have additional questions beyond buying a HUD home at the Hudhomestore, you can talk to a financial advisor who can review your finances and help you reach your goals (whether it is making more money, paying off debt, investing, buying a house, planning for retirement, saving, etc).

So, find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.

The post How to Buy a HUD Home at the Hudhomestore Website? appeared first on GrowthRapidly.

Source: growthrapidly.com