FHA loans (again)

[Bill]

I was talking to the dealer today and mentioned that my wife and I would like to go FHA and he said that the maximum amount allowed is 48,000. I think he is mistaken. When I look at the FHA website, it says that manufactured homes qualify for the 203B program and a single family home here in WV has a cap of 172,000. He says a manufactured goes under "Title One' if you do FHA and is only allowed 48,000 He does admit that he has never put an FHA loan through however. I am going to contact the WV housing authority Monday but was hoping some of you have done an FHA loan before and could help me. Thanks!

[rmurray]

Title 1 FHA is for home only loans...there is a very low total loan limit...Title 2 FHA will do a manufactured home with land loan limits very in every county...It is calculated by the local cost of living...This would be the program that you are referring to...Each have different policies and underwriting rules...If you dealer has never done an FHA Title 2 loan...He will be out of business soon..most land/home sales use this type of furnace right now...Title 1 home only loans are rare because of the low limit for th loans..very few homes are sold this way...

[Bill]

Murray,
Thanks for your response. Another question: Since we own the land, would we still qualify for a Title 2? I understand that FHA requires land improvements such as block foundation, gutters, sidewalks, porches, etc, so if that were rolled into the purchase, would we qualify for a Title 2 even though we own the land? I was thinking that surely people are able to borrow more than the 48,000 on a aTitle 1! The home we are looking at is around 65,000 and with the required improvments, the total would probably go up to 75K. That's why I thought we would have to go with a 203b. I hadn't heard of a Title 2 and can't find any info on with search. So again, any help you can offer is greatly appreciated!
I agree with them going out of business unless they start using the Title 2 loans. I was trying to tell them that their competitors were all using FHA and they said "Yeah, a lot of people have asked us about FHA but we aren't sure how to go about it." They need to get with the program, that's for sure!! I don't want to portray them as bumbling newbies. In fact, they have owned their business for almost 25 years. They just don't seem to have moved with the times. When I told the older one to look at the website for FHA, he admitted he didn't know how to use a computer! lol
Do you suggest I tell them to call the FHA office for info if they are serious about participating in FHA loans for their customers or are there other avenues that a dealer takes?

[Bill]

I have another question related to this: We had been torn between this Dutch home and one from Fleetwood. I know for a fact that Fleetwood handles FHA loans because several of our friends secured financing this way. The only reason we didn't go with Fleetwood is because my wife liked this house better. However, now there is this trust factor--why didn't the man say he didn't know much about FHA BEFORE taking our application? And my wife is reluctant to keep working with him. So, CAN we switch to Fleetwood even though we have given him our info and he has sent in apps to at least five different companies or should we wait it out and see if he learns really fast about FHA as he says he will? I mean, I know mortgage inquiries supposedly only hurt as one score for a thirty day time period however, I know nothing about if you can switch horses mid stream. If he DOES apply for FHA financing and we also give Fleetwood our info this evening, will that cause a problem? I'm sorry if this is confusing, I've been in shock since I saw those high interest approvals and heard him say "I really don't know much about FHA"...................
Thanks again for any advice!

Bill

[Pendragon]

>block foundation, gutters, sidewalks, porches

Don't know about block foundations, but none of the other items are required for FHA.

[TanyaF]

I believe there are requirements about the steps, even if you don't have a porch. They have to have a certain size landing, steps a certain width and height, affixed to the house. But our steps and skirting company was familiar with these requirements. We just said "FHA steps" and they knew what to do. But we certainly did not need sidewalks, etc, and our foundation system "Suresafe" meets FHA standards without using a block foundation.

[rmurray]

It is hard to believe there is a dealer left who is not up to speed with FHA mortgages...I would suggest you move on because this guy will be out of business soon or your set up will be a nightmare since FHA set up specs are quite different and his ignorance WILL cause lots of delay and trouble...Since you already own the land you will have no problem qualifying for FHA...You have not mentioned your credit scores..If they arer over 630 you will also qualify for conventional conforming mortgage finance...

The best mortgage education site I have ever seen is at http://www.mtgprofessor.com/

This page has good info on FHA insured loans...

http://www.hud.gov/buying/insured.cfm

FHA does have some site rules including access to the home..the land...the land must meet FHA criteria...Some FHA inspectors require specific landscape requirements...Gutters are not required in manufacurted homes...A good loan originator will guide the dealerr through the process......

[Bill]

Thanks all for your input. We visited a Fleetwood dealer who works with FHA on an almost daily basis and got some really good information about FHA. We said up front that we just wanted information and the man spent almost an hour with us telling us about FHA. He gave me a lot of info that I didn't know about and then confirmed some that I already knew so I felt pretty good when I left him.
Murray, I called the man who didn't know about FHA this morning and told him I was sending a letter telling him I was no longer interested in working with him and to cease any and all credit/application activitity. He seemed confused about why I was so upset and I told him he had definitely misrepresented himself. He kept saying an FHA loan was going to cost more than the 11% loan he already had approval for! lol My mid scores are above 650 so I think even a non FHA loan will be better than that when we apply again.
According to the man at Fleetwood, we can either go with a block foundation or skirting. No gutters but we do have to have a 5 by 5 porch with steps. He said the biggest drawback for most people is the insurance and taxes that have to be in escrow which can add anywhere from 75 to 100 per month on the payment. Does this sound right? This was the one part I was not aware of.
Again, thanks so much for such great information.

[jgn]

Take your insurance and taxes divide by 12 and that is the amount you will need to escrow every month. You have to escrow your taxes and insurance on any loan that has less than 50% equity (some lending institutions will let you waive the escrow if your equity is high enough. What a conventional mortgage requires is proof of one year insurance and three months taxes at closing than 1/12 of the insurance and taxes to be paid every month. If you escrow to much the finance company must refund the difference and if to little your payment goes up by the difference. Shop insurance with several brokers and stay away from dealer offered insurance because they are generally higher than you can get elsewhere.

[david kestler]

I am an FHA DIRECT lender in NJ, MD. VA and soon PA how can I go about getting in touch with people who are in need of a FHA lender for purchasing or refinancing doublewide homes?