Tag: covid

FHA Underwriting Guidelines for Borrowers with previous Mortgage Payment Forbearance – Mortgagee Letter 2020-30

Written by:  Tracey Rumsey, Staff Writer Rule Synopsis: Effective dates May be implemented immediately but must be implemented for case numbers assigned on or after November 9, 2020. Affected Programs Only Title II Single Family Forward programs. New FHA Mortgage Eligibility A borrower will be considered eligible for a new FHA-insured mortgage when previously granted […]

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Is a Borrower that Is in Forbearance Eligible for FHA Financing?

Question: Can a borrower be eligible for FHA financing if they have a COVID-19 forbearance? Answer: You can do a mortgage for a borrower in forbearance with some conditions.  Mortgage Letter 2020-16 outlines these conditions. Yet like all things new and untested, be prepared for investor overlays.  This is definitely a situation you want to […]

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What Temporary Guidance Has Been Issued by FHA for Self-Employed Borrower Income?

Question: I am being challenged with a self-employed file and documenting it correctly.  What is needed in today’s COVID world? Answer: The requirements for the YTD P & L and the 2 months of bank statements are standard underwriting requirements. The only new COVID-related requirements for self-employed borrowers were recently issued in Mortgagee Letter 2020-23 […]

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How is COVID Pay Being Treated by Fannie Mae?

Question: I have a client with a paystub that shows “COVID Pay”.  The employee worked reduced hours/fewer days per week due to the pandemic.  The employer states that the COVID pay is the difference between what they would have earned and what they earned.  Now that the company shutdown is over, our client is back […]

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Calculating the Student Loan Payment When Interest Rates Are Temporarily Reduced

Question: My client’s student loan is deferred with a $0 payment.  I requested a letter from the student loan carrier regarding the amortized payment and it came back with 0% interest due because of the virus.  Will FHA accept that temporary interest rate? Answer: There is no specific guidance from FHA regarding temporary interest rates, […]

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