For those who lost their homes due to foreclosure, short-sale or went through bankruptcy over the past few years, if you’ve recovered economically, you may be able to buy, sooner than you think.
FHA has announced it has shortened the waiting period for homeowners who went through true hardships to purchase a home again.
The move is part of the Federal Housing Authorities ‘Back to Work’ program, intended to provide relief to those who have recovered from their economic troubles and who desire to re-enter the housing market.
Previously, guidelines required a wait of as much as 7 years
It is a three-step process, involving first the proof that there truly was an ‘economic event’ such as a loss of job, resulting in a 20% reduction in income. Those who just decided ‘I’m underwater so why should I keep paying for it?’, won’t qualify.
Second, they must prove that they’ve fully recovered and that purchasing a home would not create further hardship.
Lastly, they must complete one-on-one counseling program from at Department of Housing and Urban Development-approved counselor.
If they meet all of these requirements, they may qualify for an FHA loan which allows them to put down as little as 3.5% on a purchase.
“This is what the market needs, new people coming in and buying homes to live in,” said Stuart Vener, President of Willshire Holdings, a firm which helps underwater home owners. ”This whole real estate debacle is not going to be cured by real estate investors buying homes, renting them and hoping to flip them at some time.”
www.steveheardrealtor.com
What do you think? Good thing? Bad? Indifferent?