Friday, September 6, 2013 - Article by: Aundrea Beach-Greco - CMG Financial | Aundrea Beach-Greco & Associates -
Hello All - We have had some pretty exciting news recently from HUD. The new mortgagee letter allows for 12 month seasoning for a foreclosure, Bankruptcy CH 7, CH 13 or a short sale on a new FHA purchase loan. Effective case numbers assigned on or after August 15,2013 through Sept 30, 2016---Borrowers must meet all other applicable FHA eligibility and policy criteriaBorrower Eligibility:
Borrowers that may be otherwise ineligible for an FHA-insured mortgage due to FHA's waiting period for bankruptcies, foreclosures, deeds-in-lieu, and short sales, as well as delinquencies and/or indication of derogatory credit, including collections and judgments, may be eligible for an FHA-insured mortgage if the borrower:Economic Event- any occurrence beyond the borrower's control that results in Loss of Employment, Loss of Income, or a combination of both, which causes a reduction in the borrower's Household Income of twenty (20) percent of more of a period of at least six (6) monthsOnset of an Economic Event- the month of Loss of Employment/IncomeRecovery from an Economic Event- the re-establishment of Satisfactory Credit for a minimum of twelve (12) monthsAttend Housing Counseling
NOTE: Foreclosures, deeds-in-lieu, Short Sales and Bankruptcies require that 12 months have elapsed since the date of the derogatory item (i.e. date of sale for a short sale, discharge date for a bankruptcy. etc).Housing Counseling:
To qualify under the guidelines of the Mortgage Letter, borrowers, co-borrowers and Non-Occupant borrowers must:- Receive homeownership counseling or a combination of homeownership education and counseling provided that each participant receives, as a minimum , one hour of one-on-one counseling from HUD-Approved housing counseling agencies- The counseling must address the cause of the economic even and the actions taken to overcome the economic event and reduce the likelihood of reoccurrence. The housing education may be provided by HUD-approved housing counseling agencies, state housing finance agencies, approved intermediaries or their sub-grantees, or through an on line course.Note: Counseling must be completed a minimum of thirty (30) days but no more than six (6) months prior to application. Housing counseling may be conducted in person, via telephone, via internet, or other methods approved by HUD.Housing counseling may be conducted in person, via telephone, via internet, or other methods approved by HUD. A list of agencies can be obtained online at www.hud.gov/counselingservicesYour fico score will still determine if Standard FHA guidelines or FHA Portfolio guidelines will be followed. Any questions please let us know.
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