Category: FHA

Prorated Tax Credits for Down Payment on FHA Loan

Question: Is it true that tax prorations from the seller can be used towards the borrower’s minimum contribution on FHA loans? Answer: Not really. While the borrower can bring less money to the closing table because of tax proration credits, they have to be able to document that they had enough funds from acceptable sources […]

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Charge-Off – Auto Loan

Question: Is a charge-off auto loan required to be paid off prior to closing for an FHA loan? The credit report shows the auto loan in the collection section of the credit report, but the debt clearly states, “charge off”. MC Chart – Collections & Judgments Answer: I understand your confusion, but since the debt […]

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FHA Mortgagee Letter 2020-37 – Re-Verification/Extension of Re-verification of Employment guidance and Updated Appraisal Scope of Work Option for FHA. New MTP™ FHA Exterior Only Appraisals – What You Need to Know!

Written by: Tracey Rumsey, Staff Writer COVID continues to affect the way we do business.  In this update, FHA issues important guidance changes on appraisal and employment re-verification. Rule Synopsis: Effective dates Re-verification of employment guidance from ML 2020-05 is effective immediately for cases closed on or before December 31, 2020. The updated appraisal guidance […]

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Are Foreclosed Properties Exempt from the Flipping Rule?

Question: Are foreclosed properties exempt from the FHA flipping rule? Answer: A foreclosure is exempt from the flipping policy when the entity selling the property is on the list of exceptions in the guideline below. MC Chart – Property Flipping Rules – All Agencies   Reference:4000.1 II.A.1.b.iv.(A)(3) Exceptions to FHA property flipping restrictions are made […]

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Game Changer Alert – FHA New Construction! FHA just announced that they are removing the 90% LTV restriction on new construction that was not “pre-approved”.  Big News that will help a lot of homebuyers!

Game Changer Alert – FHA New Construction! FHA just announced that they are removing the 90% LTV restriction on new construction that was not “pre-approved”.  Big News that will help a lot of homebuyers!

Related Article Title: FHA Mortgagee Letter 2020-36, FHA New Construction Requirements, Effective dates: May be used immediately for existing cases and must be used for FHA case numbers assigned on or after January 4, 2021. Multiple Updated Charts! Written by: Tracey Rumsey, Staff Writer FHA new construction programs are fantastic to understand, especially when you […]

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