Don't Let Breaking News Lead to Breaking Promises 


When it comes to breaking news, accuracy is always more important than speed.

A great example of this important idea was made clear this week after information was released that stated HUD would now begin to allow qualified FTHBs (First Time Home Buyers) to utilize their anticipated tax credit toward their down payment and closing costs in advance of actually receiving it - and the story shot through seemingly every channel of our industry, at lightening speed.

In fact, a mortgagee letter had even been posted on HUD's website. Unfortunately, the letter was quickly removed from HUD's website, creating a buzz of uncertainty and confusion that shot through the industry just as quickly. Those who chose to blast the story out to their contacts right away, however, were left scrambling to find answers that simply didn't exist.

As of right now, there is no such program or "bridge loan" in place.  It might be prudent to mention however that there may be some smaller banks and financial institutions out there creating their own work around to this dilemma and keeping these loans in their bank portfolio since they can not send these loans to secondary market, i.e. FHA, etc.   We do not at this time as an industry have a HUD, FHA / VA, Fannie Mae or Freddie Mac approval for a way to lend first, credit later.  So please be wary of any misinformation that may come your way.