Since when is staying current on your mortgage not enough?


Recently, a leading business magazine published an article about a young woman who bought a house with an FHA loan and paid the required 3.5% down payment. This article is one of the most biased and devoid of facts I have seen in a long time. It briefly describes the process of obtaining an FHA loan, then goes on to attack a woman using the loan, as well as her family.

The article seems content to continually make unsubstantiated claims without considering the actual facts. By the brief mention of the actual details, it appears that this woman took out an FHA 203(k) loan. This type of loan allows the owner to obtain money beyond the purchase price in order to be able to carry out the necessary repairs/improvements to their house. In this woman’s case, when she bought the house, it was “just a ‘box’ with no kitchen or bathroom”.

This loan allowed him to set up a kitchen and a bathroom and considerably increase the value of his house. The author has a problem with her saying that her house increased by $100,000 in value by making the improvements. He calls it “brand valuation to the imagination” and also says “she gives no indication of how she came to the conclusion that she made $100,000 in just one month. “. Well, apparently the author didn’t do the research on the loan program he was so keen to criticize. When the appraisal is done for an FHA 203(k) loan, the FHA appraiser gives a value for the current value of the home (which is not the same as the purchase price) and then also a value for what the house will be like once the repairs are complete. Also, the purchase price of this particular home, which was previously a foreclosed property, was likely below its actual market value to begin with.

After making a few brief statements about FHA loan program, which have been buried under all the calumnies, the author then goes on to attack his father. The author relates a story told by the woman that her father first bought a house and then began to acquire finer things. The author makes it clear that he believes the father was not paying for these items, but rather “using their house as an ATM.” Making unsubstantiated claims about someone the author actually spoke to is wrong, but making those claims about an unknown family member of someone he interviewed is heinous. It’s sad that people like this have a following and are able to sway people’s opinions.

This woman’s decisions are none of the business of others until she begins to affect the lives of others. Since she is current on her mortgage, she is stimulating the economy, not diminishing it. Hopefully she will continue to invest in the real estate market, stay committed to responsibility, and enjoy the privilege of home ownership.

Source by Anne H Johnson

Comments are closed.