Monthly Archive: February 2015

Need Home Advice? Get a HUD-Certified Housing Counselor


First time homebuyers may find homeownership an exciting prospect. However, the homebuying process can have you navigating the travails of mortgage applications, budget issues and listing agent searches.

If you need housing advice, the U.S. Department of Housing and Urban Development (HUD) has certified housing counselors to assist first time homebuyers with counseling services.

Housing counseling is one of the federal government’s programs for helping homebuyers and homeowners by providing guidance or making recommendations through the housing-related services that HUD offers such as homeownership, renting, foreclosure, mortgages, and credit issues.

Knowing your housing counselor

As federal government employees, the majority of housing counselors are professionals who work full time and enjoy benefits aside from having a good compensation and job security. They work in an office setting so you can always contact a housing counselor in local offices and get the advice you need. Housing counselors also work during normal business hours with only a few exceptions so they are pretty reachable.

Most housing counselors have undergone professional training and granted certification by HUD since housing education programs provided by educational institutions are rare. HUD imposes housing rules and regulations, both on the federal and local level, where housing counselors are easily familiar with.

How housing counseling works

As HUD gives support to a nationwide network of Housing Counseling Agencies (HCA), you can guarantee that HCA’s counselors  are trained and approved to supply you the necessary tools and resources so that you can make responsible choices in tackling your housing needs taking into consideration your financial circumstances.

Housing counseling agencies are spread throughout the country and offer free or low-cost advice. HCAs participating in HUD’s Housing Counseling Program are not allowed to charge consumers for specific housing counseling services. As a housing counseling recipient, you are not required to pay for these services.

Becoming a HUD Housing Counselor

HUD provides a series of programs and services to homebuyers and current homeowners, where one of them includes home counseling. To become a HUD housing counselor, you must obtain training and be instructed with HUD’s current rules and regulations. Agencies that participate in programs run by HUD also offer training programs for aspiring housing counselors. Certification is granted to those who qualify, as well as scholarships that cover most of the training expenses.

Aside from HUD, potential housing counselors can receive certification from other professional organizations. For example, the National Association of Housing Counselors and Agencies (NAHCA) presents an all-inclusive certification, and four supplementary specialized certification levels in homeownership, tenancy and agency and administration. NAHCA’s Certified Professional Comprehensive Housing Counselor certification calls for a bachelor’s degree and work experience, or a combination of six years of education and experience. As a NAHCA candidate, you must complete a training course and pass an exam in order to earn a certification.

There are also other state-specific programs that offer training for housing counselors such as the Association of Housing Counselors. The HUD website lists down an array of state and local training programs.

HUD-endorsed organizations like NeighborWorks provides coursework in various topics that include the basics of lending, compliance of state and federal regulations, methods of education and introduction to housing counseling.

Top Reasons Why You Should Buy a Home


Having mixed feelings about buying a home? If you’re a first time homebuyer tired of paying rent or living at your parents’ house, you might consider getting your own space.Most first time homebuyers are actually young professionals – young couples and singles, who have the budget but scared about taking on debts and getting tied down.

In the event that you actually opted to purchase real property because you can afford it, here are 10 more encouraging reasons why you should consider getting that dream home.

  • This sounds cliched, but buying a home is one of the best, long-term investments you can ever make. Property prices are inclined to eventually rise, and housing trends are likely to continue. So, if you’re purchasing a home now, you have placed your personal finance in a safe investment box. If you aim for affordability, distressed homes are often up for sale so you might want to start your shopping there. Bear in mind however, that such properties are not upgraded or improved so you’ll have to shell out more than you think.
  • It comes with lesser tax. The interest you pay on your mortgage is deducted from your income. This tax break value relies on several factors such as your personal tax range, mortgage size, interest rate, and the duration of your mortgage. If a mortgage is new, the interest rate you pay monthly is greater and the tax break is bigger. So, recent buyers with newer mortgages are likely to achieve the most benefit.
  • Enough putting cash into your landlord’s pockets each month. Wouldn’t it be satisfying if you don’t have to pay for something that you’re not capable of owning? Renting costs are actually higher than monthly mortgage payments. Even if the property you’ve bought did not appreciate in value or price, you can still sell it and reclaim some of the cash you have invested in it. This way, you’ll have the stability and security of owning a home and live in it all you like. Plus, there will be no worrying about rent increases or negligent and tyrannical landlords.
  • Take advantage of low interest rates. This makes it comparatively cheaper in taking out a mortgage. Low interest rates mean lesser payment for your home and the sooner you can pay off your mortgage.
  • You can do home improvements anyway you like. You can choose what needs to be replaced, renovated or overhauled. If you decide to sell the house, these renovations will add value and make your property marketable.
  • You can use your home equity for low-cost loans for other personal purposes. You will be able to access the paid equity you have accrued in the form of home equity loans or home equity lines of credit. Since home equity loans and lines of credit are secured, they cover lower interest rates than other kinds of loans, such as car loans. They also have an interest that’s tax-deductible.
  • As a homeowner, you’ll be able to get to know your community. You can participate in community affairs, have a greater voice, and have more influence when it comes to discussing issues about community development, school, traffic, and the like. Renters are more transient and detached.

First Time Homebuyer Programs for Veterans


First time homebuyers may have saved for a down payment, but usually such savings are not sufficient to finance the additional costs involved with a home purchase. However, the U.S. Department of Veterans Affairs (VA) offers home loans to servicemembers and their families which are designed to help them finance homeownership.

VA’s home loans allow eligible military members, veterans and their surviving spouses to become homeowners. As part of its efforts to help servicemembers who are first-time homebuyers, VA provides home loan guaranty benefits and other homebuying programs to help with the purchase, construction, and repair of a potential home.

Private lenders (such as banks and other mortgage institutions) usually provide these VA loans. VA guarantees a part of the loan, which allows the lender to offer the homebuyer more reasonable terms. VA loans are easier to qualify for since they are government-backed and are available at competitive rates.

VA home loans are used to:

  • Purchase a home or a condo unit within a VA-approved project
  • Construct a home
  • Buy and improve a home at the same time
  • Make improvements such as installation of high energy-efficient features
  • Obtain a manufactured property (home or lot)

Take a look into these VA loans to help you get started with your home purchase:

Purchase Loans

Under this program, VA offers home loans that enable you to buy a property at a competitive interest rate without the necessary downpayment or mortgage insurance.

VA’s Cash-Out Refinance Loan

This loan program is designed for homeowners who wish to get cash out of a home equity to pay debts, rehabilitate homes or fund school. The loan can also be used to convert a non-VA loan into a VA loan. VA will guarantee loans as much as 100% of your home value.

VA Home Loan Guaranty

Private lenders usually manage VA home loans, while VA seldom gets to be involve in the whole loan process. What VA does is guarantee a portion of your home loan acting as the “insurance” that you provide the lender.

Benefits of VA home loans

VA provides the guarantee to lenders, which enables them to provide you, the home loan borrower, more favorable terms and rates. These include:

  • No required down payment given that the sales price doesn’t go over the value of the home appraisal.
  • No required private mortgage insurance premiums.
  • Seller may pay the closing costs.
  • As a borrower, you cannot be charged a penalty fee if you pay off the loan early.
  • VA can offer you assistance in case you can’t make due payments that are due.

While these home loans can benefit the first time homebuyer, take note that you don’t have to be one to be eligible for these loans and reuse the benefit. Plus, VA home loans are assumable, providing that the buyer  assuming the loan is eligible.


To qualify for a VA-guaranteed home loan, you must be a servicemember or veteran, have a decent credit history, sufficient income and a validated Certificate of Eligibility (COE). It is required that the home you opt to purchase must be for your personal occupancy.

To get a COE, servicemembers and veterans must be discharged under reasonable conditions (except dishonorable discharges) and meet specific service requirements.

According to VA, other applicants that may qualify for home loans include:

  • U.S. citizens who participated in the armed forces of a government that is allied with the United States during World War II.
  • Individuals that served as servicemembers in certain organizations such as: Public Health Service officers, United States Military cadets, Air Force, or Coast Guard Academy, United States Naval Academy midshipmen, National Oceanic & Atmospheric Administration officers, World War II service merchant seaman, and others.

Why First-Time Homebuyers Need a Home Inspection

home-inspectionThe United States Department of Housing and Urban Development (HUD) offers first time homebuyer programs across the United States and its underlying territories to help buyers become homeowners. One of HUD’s homebuying programs goes under the Federal Housing Administration (FHA), wherein the self-funded government agency insures mortgages on loans made by FHA-approved lenders. The program allows lenders to offer financial assistance to first time homebuyers who may not be eligible for conventional loans.

However, FHA also advises first-time homebuyers about getting an independent home inspection before purchasing. While FHA insures loans, the agency does not guarantee if your potential new home comes with issues concerning repair or health and safety hazards after closing.

Why you need a home inspection

For first-time homebuyers, FHA stresses the importance of having a home inspection. Why? Getting a home inspection provides homebuyers access to more comprehensive information about a prospective home. During a home inspection, qualified home inspectors examine a home thoroughly and free of bias.

A home inspector:

  • appraises a home’s physical condition involving the structure, construction, and other mechanical systems
  • determines the items that need repair, upgrade or replacement
  • gauges the life of components such as structure,  equipment, and interior and exterior finishes

What happens in a home inspection

Having a home inspection provides you, the homebuyer, a general objective and physical assessment of the condition of a potential home. Home inspection gives you insight on the items and components that should be repaired or replaced.

Furtehrmore, a home inspection presents you a comprehensive report regarding the potential home’s structure, plumbing, roofing, insulation, ventilation, heating, air-conditioning, exteriors and interiors.

Appraisals versus Home Inspections

Take note: A home inspection is different from an appraisal. Lenders perform the appraising, while buyers do the home inspecting.

As part of FHA’s job in insuring mortgages for the lender, the agency requires lenders to perform an appraisal to:

  • determine the value of your prospective new home
  • ensure it adheres to FHA standards
  • make sure that the property is marketable

Lenders conduct appraisals to make sure that the physical condition of a home you wish to buy meets, if not exceeds, all of your expectations. Lenders evaluate the physical condition of a home in terms of:

  • site hazards
  • soil contamination
  • grading and drainage issues
  • well, individual water supply and septic problems
  • wood destroying insects
  • private road access and maintenance problems
  • structural, foundation and roofing deficiencies
  • mechanical systems problems
  • general health and safety hazards
  • deterioriated paint

Be informed

First time homebuyers have the responsibility and the right to carefully evaluate their prospective new homes accompanied by a qualified home inspector. Being an informed homebuyer is crucial; you have to ensure that what you buy is satisfactory.

If you’re in the process of a home pruchase, employ a home inspection before signing the contract. Good inspectors should check up certain components of a home and then produce reports covering detailed findings. Ask questions if necessary. Home inspections may take an amount of your time and money at present, but you will be relieved you did for the long haul.

Your Ideal Home within Reach: A Look into First Time Homebuyer Programs


One of the most important choices a person can make, especially for a first time homebuyer, is to decide whether to purchase a home or not. Acquiring real property is a huge investment and it’s a conscious choice that involves an amount of money, time and effort.

That’s why first time homebuyer programs are available to help any first time homebuyer who is considering purchasing a home.

You can look into the different types of homebuyer programs that are listed below:

HUD Home Buying Programs

The United States Department of Housing and Urban Development (HUD) offers assistance to home seekers at a local level. HUD has introduced home buying programs with the intent of educating homebuyers as well as help them go through the process of searching for a new home. HUD’s website lists down the home buying programs offered in specific areas across the U.S.

  • Good Neighbor Next Door

This program is also formerly called Teacher/Officer/Firefighter Next Door. In an effort to create dynamic communities and safer neighborhoods, HUD has recognized law enforcement/police officers, educators (pre-K to 12), firefighters, and emergency medical technicians and provides them incentives in the form of 50% discounts from the price list of a property or home. However, they must commit to reside in the property for at least 36 months and maintain it as their primary residence.

To participate in the Good Neighbor Next Door, you can check your state listings and submit an interest in buying a home of your choice. The main requirement is that you should be an educator, firefighter, law enforcement officer or emergency medical technician and can act in accordance with HUD’s program regulations.

  • Homeownership: For Public Housing Residents

Under this special homebuyer program, HUD aims to assist a public housing resident become a homeowner. Public housing residents are now able to turn their rent into mortgage payments.

There are various Public Housing Homeownership Programs being offered by HUD. Eligible residents may acquire assistance from a local Public Housing Authority (PHA). PHAs run voucher programs, and these vouchers can be used by the applicant for their monthly mortgage payments. The voucher covers real estate taxes, mortgage payments, utility bills, and maintenance costs.

To be an eligible applicant, an individual needs to be a first time homebuyer. The program also utilizes family income, accompanied by household expenditures, to compute the amount each participant receives on a monthly basis.

  • Indian Home Loan Guarantee Program (Section 184)

This loan program is specifically aimed at American Indian and Alaska Native families, Alaska Villages, Tribes, or Tribally Designated Housing Entities. These loans enable Native borrowers to construct, rehabilitate, refinance or purchase a home.

HUD’s Office of Native American Program’s Office of Loan Guarantee provides the home mortgage loans and guarantees them 100%. This is also HUD’s way of strengthening the financial footing of Native American tribes and communities.

  • Federal Housing Administration Loans

The FHA, part of HUD and completely self-funded government agency, offers loans to people who wish to become homeowners. FHA insures the loan so that lending institutions can provide homebuyers with lower down payments and closing costs as well as easy credit to qualify for.