FHA's Back To Work Program

FHA Credit Policy Change Makes it Easier to Qualify

Understanding MortgagesEffective immediately, policy changes in the way the Federal Housing Administration (FHA) views certain derogatory credit will make it easier for some borrowers to qualify for purchasing a home. Allowances will be made for certain “Economic Events” resulting in poor credit ratings, which previously would cause borrowers to be ineligible.

What do the new rules say? Potential borrowers who experienced a decrease of income by 20 percent or more for at least six months, and that resulted in serious derogatory credit such as a short sale, foreclosure, or bankruptcy, may still be eligible as long as:

  • The loss of employment or income was due to an extenuating circumstance beyond his or her control and can be documented;
  • A satisfactory credit history has been restored for a period of 12 months; and
  • Housing counseling has been completed.

I want to put a word of caution out that how we can document an “extenuating circumstance beyond his or her control” is Hvis du har sporsmal eller kommentarer sa ikke nol med a kontakte oss pa contact@ Casinoonline . still not very clear at this time. To me, it is clear that bankruptcies, short sales, and foreclosures surrounding a divorce do NOT apply here. We are still waiting for more clarification from FHA and investors on this. Rest assured that I will update you with more information as this program ramps up.

Other changes effective October 15, 2013 include amendments to underwriting guidelines in the area of outstanding, prior judgments and collections, including the exclusion of unresolved medical collections from the underwriting decision.

If you or anyone you know has been previously denied for a home loan based on an isolated credit incident, I may be able to help! And I”m always happy to answer any questions you may have. Feel free to email or call me at any time.