Foreclosures May Not Affect Ability to Buy with New Program
The Federal Housing Administration has extended a program seeking to help former homeowners that have had foreclosures (as well as bankruptcy, deed in lieu of foreclosure, short sales) get back on the path to home ownership once again. The FHA’s program, “FHA Back to Work Program,” will allow people to buy a new home after having been through foreclosure within as little as twelve months (typical wait times are normally three years). The program has been extended through September 30, 2016.
The program requires quite a bit of documentation to show why you were foreclosed on – a 20% loss of income for at least six consecutive months leading up the the event (also includes deed in lieu of foreclosure and short sales). A simple letter of explanation will not suffice, so homeowners will need to dig deep to show this, as without it, the program will not be applicable. Even divorce or an adjustable rate mortgage reset will not be accepted as reasons for entrance into the program. Along with the proof of loss of income, prospective homeowners will need to demonstrate that they have put the past behind them and worked to rebuild and correct their credit and must have a minimum credit score of 640 or go through a HUD approved counseling agency that focuses on home ownership and mortgages.
You can read more about the program and get started at the Back to Work Program website.
image courtesy of nigelhowe