FHA has some Big Changes that will start on Monday 9/14/15. Please make sure if you have a Contract on a home currently , that your Lender obtains a FHA Case number before Monday to insure they can follow todays guidelines and not the New guidelines that will take effect on Monday. I can’t list everything in this email but here are SOME of the changes
1) If a bank statement is provided to prove assets and the Bank Statement reflects NSF Fees, the file must be downgraded from an Automated Approval to a Manual Underwrite ( This could affect YOUR LOAN)
2) If your buyer is using GIFT funds for their down payment, then the DONOR MUST NOW PROVIDE A BANK STATEMENT , proving that the funds were NOT borrowed.
3) Social Security Income is now Maxed at 115% instead of using 125% of that figure to qualify.
4) Student Loans- Now require the applicant to SHOW what the payment will be when the loan comes out of deferment and that figure used in the debt to income ratio.
5) A Single VOD ( Verification of Deposit) is no long acceptable unless it has a most recent Bank Statement that goes along with it.
6) If a borrower is using Part time income to qualify, then there MUST be a 2 year history of UNINTERRUPTED employment so it can be used as acceptable income.
1) Child Support Income can be used if not court ordered IF the borrower can show they have been receiving it for the past 12 months.
2) A Borrower can transfer their appraisal to a New Lender and the Old Lender now has 5 days to process the transfer ( no more holding appraisals hostage)
3) Commission income may be used if the borrower has been receiving it for 1 year. ( some details apply)
These are SOME not ALL of the changes to take place on Monday. We also have the TRID changes that will be effective on October 3rd. Please make sure the Title Company that you enjoy using has their BEST Practices Certification so we can Keep using them.
Reprinted. Info provided from Chris Dubois-504-496-8988-Residential Mortgage Loan Originator