Loan Programs With No Waiting Period After Bankruptcy And Foreclosure

Loan Programs With No Waiting Period After Bankruptcy

HUD has a mandatory waiting period after bankruptcy and foreclosure. Loan Programs With No Waiting Period After Bankruptcy and Foreclosure is offered by The Gustan Cho Team at USA Mortgage and is called NON-QM Loans.

  • Currently, the waiting period is two years from the date of the discharge date for those who have a prior bankruptcy to qualify for FHA Loans.
  • The waiting period is three years for those folks who have had a foreclosure, deed in lieu of foreclosure, or short sale. 
  • Foreclosures and deed in lieu of foreclosures waiting period starts from the date the deed was transferred out of the homeowners name into the name of the mortgage lender. 
  • On short sales, it is the date of the sale which is reflected on the HUD settlement statement. 

HUD used to have the FHA Back To Work extenuating circumstances  which is no longer in effect. FHA Back to Work Extenuating Circumstances mortgage loan program turned out to be a flop. Not everyone could qualify for this special program. As of March 2017, most mortgage lenders have discontinued this loan program. This loan program turned out to be a major mess and only a few percentage of the applicants were successful in closing their FHA BACK TO WORK Loans. Most lenders have given up totally on the FHA Back to Work and have turned to NON-QM Loans. The great news is that The Gustan Cho Team at USA Mortgage offers NON-QM Loan Programs With No Waiting Period After Bankruptcy And Foreclosure.

Loan Programs With No Waiting Period After Bankruptcy

First of all, the FHA Back to Work Extenuating Circumstances mortgage programs is no longer in effect.

  • FHA Back to Work Extenuating Circumstances mortgage loans are manual underwrites so mortgage lenders who only manually underwrite mortgage loans can do these loans. 
  • Majority of the mortgage lenders do not do manual underwrites. 
  • Every case is based on a case by case basis and the first thing I would need to be sure that you qualify for the FHA Back to Work Extenuating Circumstances loan program is to get a detailed letter of explanation as of the reason why you had to file bankruptcy and/or had to undergo a foreclosure.  
  • The mortgage loan borrower needs to provide proof that he or she has had at least a 20% reduction in income for the six months or have been unemployed or underemployed  prior to the foreclosure and/or bankruptcy proceedings. 
  • The mortgage loan borrower needs to have re-established his or her credit after their foreclosure and/or bankruptcy and no late payments in the prior 12 months. 
  • Rental verification is a must. In the event if the mortgage loan borrower has no rental verification, he or she must provide a letter. 
  • This is often the case where the mortgage loan borrower has lived with family. 
  • A budget letter will most likely be required on how the mortgage loan borrower plans on paying his monthly housing and living expenses.

Housing Counseling Requirement

This BLOG is an update of  a prior blog on FHA Back To Work Loan Program. We are updating it for archival purposes.

A one hour HUD approved housing course is mandatory for those home buyers who plan on participating for the FHA Back to Work Extenuating Circumstances mortgage loan program.

  • Cannot start processing and underwriting any FHA Back to Work Extenuating Circumstances mortgage loan application until 30 days after the mortgage loan borrower has completed the HUD one hour housing counseling program. 
  • Just because they meet the FHA Back to Work Extenuating Circumstances mortgage guidelines and qualify for this program, do not go and sign a real estate purchase contract without having the one hour counseling completed and have waited your mandatory 30 days.

Manual Underwriting

The FHA Back to Work Extenuating Circumstances one year waiting period mortgage loan program that is no longer in effect.  Borrowers who are looking for loan programs with no waiting period after bankruptcy and foreclosure can qualify for our new NON-QM Loan Programs. If you have any questions please feel to contact us at 262-716-8151 or visit me at www.gustancho.com .

2017 UPDATE ON THE FHA BACK TO WORK MORTGAGE: THIS LOAN PROGRAM TURNED OUT TO BE A TOTAL FLOP AND COUNTLESS OF BORROWERS WENT THROUGH UNDUE STRESS. LESS THAN 5% OF THE LOAN APPLICANTS GOT THEIR LOANS TO BE ABLE TO CLOSE. BY THE END OF 2015, MOST LENDERS STOPPED DOING THE FHA BACK TO WORK MORTGAGE

2017 UPDATE

This BLOG has been updated on March 7, 2017. As many of you folks know, the FHA Back to Work Extenuating Circumstances Due To An Economic Event turned out to be one of the biggest disasters in modern HUD history. Only a minute fraction of borrowers who applied for this ill-fated mortgage loan program has been extremely fortunate to get a clear to close and close on their home loan with the BACK TO WORK MORTGAGE. Tens of thousands of borrowers who got a conditional loan approval with the FHA BACK TO WORK MORTGAGE submitted conditions stated on their conditional loan approval to later find out that the conditional loan approval has been overturned. This loan program sounded great on paper and it made all the sense in the world, however, for one reason or another, lenders could not adapt to this loan program. From day one, there was so much confusion. Lenders were confused but more importantly, HUD was confused also. Mortgage underwriters often contacted HUD to get conflicting answers. A lot of mortgage lenders who funded the FHA BACK TO WORK MORTGAGE found out that HUD would not insure them when it came to selling these loans to the secondary market.

Loan Programs With No Waiting Period After Bankruptcy And Foreclosure NOW Offered By The Gustan Cho Team at USA Mortgage

Loan Programs With No Waiting Period After Bankruptcy and Foreclosure is now offered by USA Mortgage, a division of DAS Acquisition Company LLC NMLS 227262.

  • NON-QM Loans do not have any waiting period after bankruptcy and foreclosure.
  • NON-QM Loan Programs With No Waiting Period After Bankruptcy And Foreclosure does require a minimum of 10% to 20% down payment,
  • Mortgage interest rates a higher than FHA or Conventional Loans.
  • It is a great alternative mortgage programs after bankruptcy and foreclosure without needing to wait the two to four year waiting period for conforming traditional home loans.
  • The NON-QM Loan Programs With No Waiting Period After Bankruptcy And Foreclosure can be used as a short term bridge financing until the borrower can pass the waiting period requirements and refinance out of it into a lower interest FHA or Conventional Loan.
Gustan Cho NMLS ID # 873293

Related> FHA Back To Work Mortgage

Related> Do You Qualify For FHA Back To Work Mortgage In California?

Related> Why Are So Many People Getting Denied For FHA Back To Work Mortgage?

The information contained on Gustan Cho Associates website is for informational purposes only and is not an advertisement for products offered by The Gustan Cho Team @ Gustan Cho Associates or its affiliates. The views and opinions expressed herein are those of the author and/or guest writers of Gustan Cho Associates Mortgage & Real Estate Information Resource Center website and do not reflect the policy of Gustan Cho Associates Lenders Network, its officers, subsidiaries, parent, or affiliates.

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