FHA Back to Work Extenuating Circumstances Mortgage

This ARTICLE On FHA Back to Work Extenuating Circumstances Mortgage Was PUBLISHED On April 1st, 2014

HUD has launched the FHA Back to Work Extenuating Circumstances Mortgage due to an economic event mortgage program last August 15, 2013:

• The Back to Work Mortgage waives the two-year waiting period after a bankruptcy and the three-year waiting period after a foreclosure, deed in lieu of foreclosure, and short sale to a one-year waiting period
• If home buyers qualify for the FHA Back to Work Extenuating Circumstances Mortgage due to an economic event residential mortgage program, they can qualify for an FHA loan after one year from the bankruptcy discharge date, recorded date of their previous foreclosure and/or deed in lieu of foreclosure, or short sale
• The waiting period start date is the date reflected on their HUD’s settlement statement
• The traditional waiting period after bankruptcy is 2 years waiting period after the discharge date of the bankruptcy and the waiting period after foreclosure and/or deed of foreclosure is 3 years from the recorded date of the foreclosure
• There is a 3 year waiting period after the HUD’s settlement date of a short sale

In this article, we will discuss and cover FHA Back to Work  Mortgage.

Qualification Requirements For FHA Back To Work Extenuating Circumstances Mortgage

To qualify for FHA Back to Work Mortgage due to an economic event loan program the borrower needs to have been unemployed and out of work and due to his or her unemployment

• The result of the unemployment was a bankruptcy and/or foreclosure or short sale
• The FHA Back to Work mortgage applicant needs to have been out of work for a period of at least six months
• The FHA Back to Work mortgage applicant needs to have been terminated and/or laid off in order for him or her to qualify for the FHA Back to Work extenuating circumstances loan program

If you voluntarily quit, you will not qualify for the FHA Back to Work mortgage program.

FHA Back To Work Extenuating Circumstances Mortgage: Credit History Analysis

The FHA Back to Work mortgage applicant needs to have had good credit prior to his or her unemployment.

• Bad credit such as late payments, collections, charge offs, during the unemployment period, is allowed and accepted
• After the FHA Back to Work mortgage applicant has secured new employment and has been financially stabilized, he or she needs to have re-established credit and no late payments whatsoever
• Reserves are a major plus and so is rental verification

Rental verification is only proven if the FHA Back to Work applicant can provide 12 months of canceled checks paid to their landlord.  These are called extenuating circumstances.

 

FHA Back To Work Extenuating Circumstances Mortgage: HUD Approved Housing Course Requirement

HUD also requires that all FHA Back to Work due to economic event mortgage applicants to take a HUD-approved housing counseling course and obtain a certificate of completion signed by the housing counselor and dated.  The mortgage applicant cannot apply for a formal Back to Work Mortgage due to an economic event loan application until after 30 days of the housing certificate date.

To qualify for a mortgage with a five-star national mortgage company licensed in multiple states with no lender overlays, please contact us at Gustan Cho Associates at 800-900-8569 or text us for a faster response. Or email us at gcho@gustancho.com. The team at Gustan Cho Associates is available 7 days a week, evenings, weekends, and holidays.