The Back to Work program recognizes that for many people, their economic status was changed by factors outside of their control and that they have worked toward getting back on better financial footing. There is new hope for those people that lost their home to short sale or foreclosure . Typically there was a 3 year waiting period for people to get another home loan. However the U.S. Department of Housing and Urban Development (HUD) recently introduced new guidelines for Federal Housing Administration (FHA) loans, essentially making it easier for eligible borrowers who have a mortgage default on their record to purchase a home.
The FHA Back to Work program allows qualifying borrowers who had a short sale, foreclosure, or a bankruptcy due to extenuating economic circumstances (reduction in income or loss of employment) to potentially obtain an FHA purchase mortgage – without needing to adhere to the three-year waiting period normally required by the FHA.
To participate in the program and have the standard three-year waiting period reduced, buyers must meet specific criteria and other requirements to qualify for a mortgage under the new program, including:
1. Have a bankruptcy, foreclosure, deed-in-lieu, short sale or delinquencies discharged, for at least 12 months.
2. Be able to document the financial hardship that lead to the mortgage default (a written job termination notice or other documentation of job loss, and W2s and/or signed tax returns to verify loss of income).
3. Have had at least a 20% reduction in household income for at least 6 months prior to their loan default. (Under the HUD program, household income is defined as the income of a borrower and co-borrower that was used to obtain the mortgage that went into default.)
4. Have re-established good, on-time credit for at least 12 months after the financial event, via new or re-established tradelines (credit accounts).
You will also be required to take a counseling course from a specific approved Housing and Urban Developing (HUD) counseling agency at least 30 days before beginning a loan application.
To see if you qualify in Texas please contact :
Coldwell banker Home loans:
Catherine Closuit @ 817-989-4815 or
Colonial Savings/Tom Sauceda Senior Mortgage Banker
512-426-0310/tomsa@colonialsavings.com
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