Tuesday, August 27, 2013

Update on FHA...Please stand by...

Update on FHA...Please stand by...
If you've participated in a foreclosure, short sale or bankruptcy with some changes from FHA you may not have to wait the 3-7 years that often followed these to purchase your next home.


There has been a lot of talk about the new FHA reduced waiting term of 1 year after foreclosure, short sale, or bankruptcy (see below). There are some strings attached. The biggest being:

“The lender must verify and document a reduction in the borrower’s Household Income of twenty (20) percent or more for a period of at least six (6) months that resulted from the Loss of Employment, Loss of Income, or a combination of both.”

The biggest issue is the fact that the investors (the ones that ultimately buy these mortgages) have not implemented these changes so it’s not yet offered by lenders. I suspect that won’t happen for another couple months.

But here is some info on the change that could help so many borrowers!



FHA Releases Mortgagee Letter 2013-26

Due to The economic downturn that the country has experienced over the past few years, FHA had issued changes to their requirements for borrowers who have experienced a foreclosure, bankruptcy or short sale; as a result of loss of income. FHA will allow borrowers to obtain a FHA loan one (1) year after the date of a foreclosure, deed in lieu, short sale or discharge of a bankruptcy. All of these events must have been a result of an Economic Event.

Borrowers must be able to document that:
  • certain credit impairments were a result of loss of employment or significant loss of household income beyond the borrower's control,
  • the borrower has demonstrated full recovery from the event; and,
  • the borrower has completed housing counseling
Mortgagee Letter 2013-26 can be found in its entirety at HUD.gov at:

Questions?  Please don't hesitate to contact David, and tell him Amy sent you!

David Dikeman, Home Mortgage Consultant , NMLS # 488101
614.310.7655 phone   |  614.330.7999 cell   | 614.310.7755 fax
150 W. Wilson Bridge Rd.  | Worthington, OH 43085   insightbank.com


IF YOU HAVE QUESTIONS ABOUT SELLING YOUR HOME, BUYING OR BUILDING A NEW ONE, DON'T HESITATE TO CALL, TEXT OR EMAIL ME. 614-657-2005

My promise to my clients: I try to always remember what it is like to walk into this incredibly complex world of buying and selling with little or no knowledge of how the process works. I know that behind the door of your home and in your life there is much more going on than just your real estate transaction. I work with each person, not the house, and with the whole person, not just the issues surrounding the transaction. When I attempt to put myself in your shoes and contemplate what you are dealing with I am most effective.
The Benadum Team

Amy Bumpus


Straight Talk—Always

614-657-2005


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