Quiz: Selling the Home Purchased with an FHA Mortgage
March 25, 2025
Is there a mandatory waiting period imposed by the FHA before you can sell a home purchased with an FHA loan?
No, the FHA imposes no mandatory waiting period before you can sell your FHA-financed home.
Does the FHA restrict the pool of potential buyers when selling a home financed with an FHA loan?
No, the FHA does not restrict the pool of potential buyers. In fact, FHA loans often attract a wider range of buyers due to lower down payment requirements and flexible credit criteria.
What is the key difference between an FHA appraisal and a home inspection?
An FHA appraisal focuses on the home's condition and safety to ensure it meets the FHA's minimum property standards. A home inspection is a more in-depth look at the property. Never trust the appraisal alone.
If an FHA appraisal reveals necessary repairs, who is typically responsible for addressing them?
The seller may be asked to address necessary repairs revealed by an FHA appraisal, though this is subject to negotiation with the buyer.
What is the first use of the proceeds from selling an FHA-financed home?
The proceeds from the sale are first used to pay off the remaining balance of the existing FHA mortgage.
Is the Mortgage Insurance Premium (MIP) recoverable when selling an FHA-financed home?
No, the MIP is not refundble unless you refinance an FHA loan within three years of purchase.
Are FHA loans assumable, and if so, what does this mean?
Yes, FHA loans are assumable, meaning a qualified buyer can take the existing loan with the approval of the lender. However, it is not a common practice.
What factors can impact the sale price and time it takes to sell an FHA-financed home?
Market conditions, interest rates, housing inventory, and local market trends can all impact the sale price and the time it takes to sell.
What potential tax benefit might sellers of a primary residence, including those with FHA loans, be eligible for?
Sellers may be able to deduct a portion of their capital gains from the sale of a residence. Check with a tax professional to learn current tax season rules.
What is the primary role of the FHA in the context of home sales?
The FHA's primary role is to facilitate homeownership by providing loan insurance, not to restrict the resale of properties.
What is a good way to prepare a home for sale that was purchased with an FHA loan?
Ensure the home is in good condition and meets FHA minimum property standards, addressing any potential issues before listing.
Why might a buyer be interested in a home that qualifies for an FHA loan?
Buyers are often attracted to FHA loans because of the lower down payment requirements and more flexible credit criteria.
What type of professional can be helpful when selling a home purchased with an FHA loan?
A real estate professional experienced in FHA transactions can be beneficial. What happens if the FHA appraisal is lower than the agreed-upon sale price? Negotiations will need to happen; the buyer may need to bring more cash to closing, the seller might need to lower the sales price, or the deal could fall through.
Does owning an FHA loan prevent you from refinancing into a conventional loan?
No, owning an FHA loan does not prevent you from refinancing into a conventional loan, and doing so will eliminate the MIP.
FHA Loan Articles
June 27, 2023The FHA loan process is straightforward and has been successfully navigated by millions of homeowners. If you're considering an FHA loan to finance your home purchase, it pays to be prepared. To avoid mistakes before you start your loan application, homebuyers should keep these tips in mind.
June 20, 2023Can an FHA loan be approved if there are late or missed payments on the credit report? Navigating through financial challenges, such as escalating costs of living and employment uncertainties, can indeed make it difficult to maintain a perfect financial record.
June 15, 2023When you buy a home with an FHA mortgage, cash for closing costs and your down payment is required. It would be easy to assume you simply give the lender cash in the specified amount and that’s the end of the story.
May 20, 2023Did you know there is an FHA loan option that lets you build a house from the ground up? You can use this mortgage to build on land you own or on land you buy as part of the loan. But you will want to address some issues comparing construction loan options.
May 3, 2023Sometimes when buying a home there may be a question of surplus or excess land. You likely won’t face this issue when buying a condo unit, but for other types of purchases, this may be an important factor in the appraisal process.
