All About FHA

Dear Edith: Who can qualify for FHA home loans? What exactly is necessary, money-wise, closing costs, credit? How do I contact them? Do I consult a Realtor to do this? -- J.H.

Answer: There's nothing complicated or difficult about FHA-insured mortgages. They come from regular lending institutions like banks, savings and loans, and credit unions. The only requirements are the usual ones: good credit and sufficient dependable income to carry payments.

With FHA loans, the government administers mortgage insurance that protects the lender against loss. You pay the premiums, but with that safeguard, lenders require only 3 percent down, sometimes even less. That's the main attraction of FHA.

Real estate brokers help you find and negotiate for the house you want. They often help with obtaining financing also. Mortgage brokers specialize in bringing borrowers and lenders together. Or you can call local banks yourself to find out which ones handle FHA.

Across From A School

Dear Edith: Would you buy a house right across the street from a middle school? It's a great house at a pretty good price, but the front door looks straight across at the main entrance, with all the bus parking too. I'm worried about resale value and whether living across from a school full of rabid teenagers would drive me crazy. It's our first house, so I'm kind of freaking out.

Has anybody lived near a school? Was it a problem? -- Via e-mail

Answer: I'm pretty sure somebody has lived near a school. Some people couldn't stand it (which may explain the "pretty good price") but others would regard it as a plus. It's a matter of personal taste and family needs.

I don't understand, though, why you're even considering a house that freaks you out and might drive you crazy. There are plenty of others to choose from.

Buying With Dan

Ms. Lank: My boyfriend Dan and I are buying our first home. I have only been in my career for a year so Dan's finances are the only ones being considered, hence his name going on the mortgage. What are the pros and cons to my name on the title and/or mortgage? I was thinking if not on either I could buy our next home (in five years or so) as a first-time buyer, is that possible?

We both have good credit. Also we plan to get married in a year or two. -- Via e-mail

Answer: For this year's tax break, no one can qualify as a first-time buyer if they're married to someone who has owned a home in the past three years. There's no telling whether there will be any such program five years from now. Continued...