The FHA saga continues..........

[Bill]

Okay, so those of you have read my posts know that I am new to the home buying process. We are interested in going FHA. I talked to a Fleetwood dealer yesterday who seemed very helpful and knowledgable about FHA. We didn't apply for a loan but did express interest in a home. At any rate, he called me this evening and told me that he had 'worked' the numbers on the house. Yikes!! The house price is $68,000. He says with all the necessary added costs of FHA, we are looking at a loan amount of around 92,000!!! I am speechless! Is this even possible? I know there are some added costs such as the 1.5% added on for the MIP but 24,000 in additional costs? Please, someone tell me this isn't even close!!!!

[TanyaF]

That had to have included site improvements (??) The cost of setup, foundation, and any utilitities, skirting, steps etc that have to be done? Is this dealer giving you anything in writing? A good dealer will itemize everything in writing without giving you any hassle!
-not an expert, but recent FHA home buyer.

[rmurray]

Have him itemize all added expense.....There will be closing costs..additional set up costs..more costly steps and landings Costs of a constreution loan..including interest while building...An FHA set could well be an advantage to you when you sell...These expenses can run many thousands..as well as sales tax....All much better than the higher rate you mentioned with the other builder...The higher rate costs about $15000 additional interest per 1% in rate...Go for it...

[Allida]

I have had this same experience here in Alabama, but not quite that much expense. FHA requires a higher standard by requiring the home be put on pier and beam or slab, and of course the slab would be the most expensive. Either way eliminates ever having to level again. With pier and beam the concrete footing has to be sunk into the ground so many inches. Also they do not allow skirting you have to brick around the bottom. A price saving alternative to this is concrete block. I was told the added price for this set up was around $12,000 and that was with brick.

[mitch]

i am a dealer on the gulf coast. we have been heavily involved with fha financing and although the costs are around 12 to 15 thousand more you do get a lot better finished product as well as having all finance options available to a prospective buyer when it is time to sell

[TanyaF]

We went FHA, but used the Suresafe foundation system. It's FHA approved, but does not require a slab or stem wall.

[Lowell Baldwin]

I am an FHA Lender in Tennessee and specialize in Double Wide, Manually Underwritten FHA Mortgages. In TN., your normal costs for FHA Compliance including footers, delivery and set up is about $18,000 depending on size of your home and elevations. Most in expensive foundation in TN. are concrete 4" block with to code venting and crawl space entry door. FHA Guidelines mandate footers for both the piers and foundation be installed below frost line, which varies from zone to zone. Your local FHA Inspector can answer specific questions regarding installation, steps, handrails, entry landings, gutters, down spouts, etc. Your dealer can add up to 6% in closing costs and prepaid reserves, 3% Buyers Fund Down Payment funding and pay these amounts in the Sales Contract. Closing costs include:Appraisal, credit report, processing fee, underwriting fee, Title Co. fees including Title Search, Title Insurance, recording fees, taxes paid to the State, County, City. Mortgage Insurance can be financed, homeowners insurance is paid for 12 months in advance plus 3 months reserves in escrow. Mortgage insurance and property taxes also require reserves paid into escrow. These costs can be paid by the Seller after he adds them to your purchase price. Your added foundation and site work should NOT BE TAXED as part of the purchase price of the house. These are Capital Improvements subject to use tax, dealer pays the tax on the materials when he purchases them and the labor is not taxable.
Your Dealer should give you an itemized breakdown of all costs and your Lender is required to provide both a Good Faith Estimate and a Truth In Lending Statement.
Your Fixed Interest Rate as of 05/12/05 should be between 6% and 6.25%.

[VV]

I know that foundation, you should see the reviews and testimonials--they're great! And, the foundationperform just like they said!!