There seems to be some justifiable cynicism about whether or not lenders will fully adopt FHA's guideline change allowing sellers who are current on their mortgage and other installment debts at the time of the short sale (and where the proceeds from the short sale serve as payment in full) to purchase a new home using a FHA loan. Many seem to assume that even if FHA allows it, lenders won't fund the loans or will add so many underwriting guideline overlays that it becomes impossible to do them.
Yeah, that turns out to not be the case.
This guideline change is still so now that many lenders haven't even updated their websites. Here's a few who have and are funding loans in accordance with the new FHA guidelines concerning short sales and short refinances (there's more but this gets the point across):
• Wells Fargo Wholesale (memo W09-224)
• Wells Fargo Correspondent (memo W09-224)
• Flagstar Wholesale (memo 09294)
• Flagstar Correspondent (memo 09294 - not delegated)
The truth is that there are a lot of lenders that are adopting this policy in the same way as Flagstar and Wells Fargo; they just haven't made formal announcements yet.
As a Realtor, if you want your clients to get access to these 4 listed funding channels contact your preferred mortgage broker or mortgage banker/correspondent and make sure they're set up with them and you'll be just fine. You aren't looking for a needle in a haystack because these are common investors for brokers and correspondents to keep contracts with. I wouldn't even characterize this as a niche loan program.
There's no need to "wait to see how this is going to play out" because it already has played out. It would appear that FHA has given the market a break and the lenders didn't spoil the party (can you believe it ?!?!?!?).
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