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FHA drastically reduces waiting times for foreclosures, bankruptcies

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Mortgage Professional America | 19 Aug 2013, 06:18 AM Agree 0
The FHA has made it drastically easier for once-struggling homeowners to qualify for a mortgage backed by the agency
  • Ron Moorhouse | | 19 Aug 2013, 07:20 AM Agree 0
    Is this effective immediately?
  • John C Durham | | 19 Aug 2013, 07:29 AM Agree 0
    Wonderful news for all Americans.
  • Ron Bennett | | 19 Aug 2013, 08:14 AM Agree 0
    This will help a lot of people get back into the market sooner.
  • Milly D'Angelo | | 19 Aug 2013, 08:15 AM Agree 0
    Great news
  • Mr. Will from Jacksonville | | 19 Aug 2013, 09:38 AM Agree 0
    This should definitely give some relief.
  • Mr. Will from Jacksonville | | 19 Aug 2013, 09:39 AM Agree 0
    This is good news.
  • Bob Martin | | 19 Aug 2013, 10:20 AM Agree 0
    Adam Smith, can you provide the Mortgagee Letter number that specifically addresses this reduction in wait periods and the parameters that borrower must meet? Thank You.
  • Bob Martin | | 19 Aug 2013, 10:32 AM Agree 0
    Mr. Smith,

    I just called FHA 1-800-callfha and they could not confirm the claims that you have made in this article. Please supply your sources of this information as FHA still requires 3 year wait period if applicant experienced short sale previously. Wait period for CH 7 Bankruptcy remains for three years. Ch 13 Bankruptcy has always been one year or 2/3rds of payments completed the greater of, with timely payments on the CH 13 to the trustee. Again, please document or site the source of your information. Thank You
  • greenfront | | 19 Aug 2013, 10:46 AM Agree 0
    Mortgagee Letter 2013-26
  • Jana | | 19 Aug 2013, 10:52 AM Agree 0
    ML 2013-26
  • Jessica Robinson | | 19 Aug 2013, 10:55 AM Agree 0
    Mortgagee Letter 2013-26
  • Ron Moorhouse | | 19 Aug 2013, 11:00 AM Agree 0
    it is Mortgagee Letter 2013-26
    Date: August 15, 2013
    To: All FHA-Approved Mortgagees
    Back to Work - Extenuating Circumstances
    Effective now, but of course each lender must decide whether to use it or not.
  • SoCalGal | | 19 Aug 2013, 11:02 AM Agree 0
    Link to authoritative source:

  • Mike | | 19 Aug 2013, 11:15 AM Agree 0
    Mortgagee Letter 2013-26
  • Wendy Smith | | 19 Aug 2013, 01:29 PM Agree 0
    This is good news. I think I will contact all my short sale sellers. Gotta go.....
  • SoCalGal | | 19 Aug 2013, 02:46 PM Agree 0
    Yes, it is effective immediately.
  • Mike | | 19 Aug 2013, 03:25 PM Agree 0
    It may be effective immediately, but do you know a lender that is doing them yet? I can't find one. This will take time.
  • Bob Ripe | | 20 Aug 2013, 08:31 AM Agree 0
    Great News !
  • Gilles | | 20 Aug 2013, 09:42 AM Agree 0
    When does waiting period after a foreclosure begin? Day I'm evicted? Day bank re-sells house?
  • Carol Wedekind | | 21 Aug 2013, 08:08 AM Agree 0
    GILLES - bankruptcy begins when court DISCHARGES it. After you file bankruptcy, you will be notified when it has been discharged. That is the date you have to use.
  • Bayview Mortgage Inc | | 22 Aug 2013, 10:30 AM Agree 0
    This is silly. Once someone Looses a home. they should be required to move in with their mother for a few years as penance.
  • Wendy Smith | | 22 Aug 2013, 11:25 AM Agree 0
    Bayview Mortgage, whoa you are ruthless.
  • John C Durham | | 22 Aug 2013, 12:19 PM Agree 0
    Hey BayView Mort. All for it as soon as about 25,000 higher up Wall Street bankers go to jail. Then everything would make sense. Your suggestion just makes more nonsense. (Where you been in the last 8 eight years?)
  • Mati Rosa Morphis - Folsom Realtor | | 22 Aug 2013, 01:45 PM Agree 0
    This is great news for many people who for the most part kept up with all their other payments and this will spark a good balance in our local real estate market.
  • Gilles | | 22 Aug 2013, 01:50 PM Agree 0

    I know bankruptcy clock starts when it is discharged, but when does it start on a foreclosure?
  • Mary | | 23 Aug 2013, 10:38 AM Agree 0
    It's been our experience the foreclosure clock starts when the property is actually sold. Verify public records.
  • Bob Gillespie | | 26 Aug 2013, 09:43 AM Agree 0
    FHA has consistently held that the 'date of foreclosure' is the actual date the lender is conveyed the property. That is the date the clock starts running. We have had several people who were ruled not eligible for an FHA mortgage because their old lender had not yet held the Trustee Sale, even though the notice was over 3 years old. One just went to sale 4 months ago, 2 1/2 years after the NOD was filed. FHA said they had to wait until 3 years AFTER the recent sale to meet the guideline ... no exceptions. We have one that had to sue BofA to foreclose 3 full years after their Chapter 7 was discharged. FHA had ruled they still legally owned the home, even though they were not responsible for the mortgage.
  • Lynn Burke | | 31 Aug 2013, 10:17 AM Agree 0
    Interesting. Federal law allows chapter 7 filers to get a mortgage 2 years from discharge but banks make people wait 3 ignoring the laws as per usual. Forget "guidelines" if they don't follow law why would they follow guidelines?
  • SoCalGal | | 01 Sep 2013, 04:37 PM Agree 0
    Lynne Burke, just because Federal law allows a debtor to take on new debt doesn't mean private enterprise MUST allow a bankrupt person to take on new debt.
  • Lynn Burke | | 01 Sep 2013, 05:52 PM Agree 0
    perhaps you should tell that to people like Jamie Dimon since there is a quadrillion in outstanding derivatives debt perhaps they should also heed that advice. No? gambling with other people's money if they win they keep it and if they lose they pass it on to the the taxpayers!
  • John C Durham | | 01 Sep 2013, 07:58 PM Agree 0
    Lynn Burke,
    You are so right on Point. The actions of criminal bankers who have sunk the World Economy, should be 99% of what we all should be talking about.
  • Mitch Daniels | | 03 Sep 2013, 11:47 PM Agree 0
    This is not good news. This is another bailout for irresponsible or shady people to be put on the backs of people who live prudently.
  • Ann | | 11 Sep 2013, 04:31 PM Agree 0
    What about people who made their payments on time but lost their job due to economic issues had to relocate and couldn't sell their home so they had to short sale? Why do they have to be punished for the banks poor mortgage practices? This new ruling doesn't help me abit
  • John C Durham | | 12 Sep 2013, 03:35 AM Agree 0
    Ann, you are so right. In the Savings & Loan crisis, when Glass-Steagall was still in effect and before all the hot security derivative paper, banks were closed down and 1,000 bankers went to jail for fraud. This time banks were paid once when the "investors" gave them money and a second time when insurance companies gave them money and they reposed homes which they didn't hold the note to, ie, fraud against the investors and the home owners.
  • John C Durham | | 12 Sep 2013, 03:47 AM Agree 0
    Ann, In my almost tragic case, I applied for a home modification. The banks took my money while keeping the old note open and reporting me late on my original mortgage! The "two track" treatment it is called. Having destroyed our credit, we couldn't go elsewhere. Nine months later they threatened foreclosure in a letter they sent. ...I'm in NY. I took them into small claims, the wrong court, but the right Branch of our government, ie, they could move me around inside the court system, but they couldn't get out of it until they shows the ORIGINAL note, which they don't have or can't show unless they expose the fact they didn't pass it through to the investors when they screwed them. ...BofA legal department called me. In 30 days they fixed our credit. In 60 days we had the modification backdated to the day we fedex-ed the application. All fees and penalties were gone. And, we made them give us an indemnity forever and any buyer an indemnity forever that: if the REAL owners (the "investors") ever came after us for their money, BofA would have to step in and pay them all the money we paid to them over the years. And, they gave us $2,000. ...(I have the photo copy of that check up on my wall-a great conversation starter, believe me...)
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