Back To Work? New FHA Loan Program

Back To Work? New FHA Loan Program

New FHA Loan Program Brings Back Foreclosed & Bankrupt Borrowers to Back to Being FHA Home Owners

“Back to Work – Extinuating Circumstances” FHA Loan Program Reduces Waiting Period for Certain Borrowers to 12 Months!


The FHA has now re-opened the doors to borrowers who previously were required to wait 3-7 years before qualifying for a new FHA Mortgage Loan. The new FHA Loan program known as “Back to Work – Extenuating Circumstance” Program slashes the previous waiting periods to only 12 months.

FHA has stated, “As a result of the recent recession many borrowers who reductions in income, were unable to make their monthly mortgage payments, and ultimately lost their homes to a foreclosure, Short Sale, or Bankruptcy. Because of these recent recession-related periods of financial difficulty, borrowers’ credit has been negatively affected.”

“FHA recognizes the hardships faced by these borrowers, and realizes that their credit histories may not fully reflect their true ability or propensity to repay a mortgage.”

The FHA Back to Work Extenuating Circumstances Program is meant to allow an opportunity to purchase a new house to those who went through an Economic Event extenuating circumstance beyond their control that led to:

• Foreclosure

• Short Sale

• Bankruptcy

To Qualify, You must have:

• A loss of income or employment that totaled at least 20 percent reduction of monthly income for at least six months.

• The loss of income must be a direct result of result of the Economic Event

• A minimum of twelve (12) months have elapsed since the date of Foreclosure, Short Sale, or Bankruptcy.

Next in order to Qualify for the FHA Back to Work Program you must have demonstrated a full recovery from the Economic Event. FHA Defines recovery as, ” the re-establishment of Satisfactory Credit and Income for a minimum of twelve (12) months.”

In Addition, those who meet the requirements for the FHA Back to Work Extenuating Circumstances Program will be required to attend FHA Housing Counseling. This will be an hour long class that can be attended in person, online, or via a phone call with a HUD-approved housing counseling agency. “The counseling must address the cause of the economic event and the actions taken to overcome the economic event and reduce the likelihood of reoccurrence.” and

it must “be completed a minimum of thirty (30) days but no more than six (6) months prior to submitting a loan application to a lender.”






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