“Back to Work” Program Helps People Return to Homeownership
Credit.org is here to help people who may have lost their homes or damaged their credit, obtain the required counseling to determine their eligibility for a new FHA mortgage. A lender will have to determine if the borrower qualifies for a loan.
Under a new federal program, consumers who had a foreclosure, short sale, deed-in-lieu of foreclosure, or who declared bankruptcy may be able to get a new loan for a home if they are back to work and can document the extenuating circumstances. Credit.org is here to help people determine how to take advantage of this program if they qualify.
FHA is allowing for the consideration of borrowers who have experienced an economic event and can document they:
- Meet FHA loan requirements
- Document the mortgage or credit problems resulted from an “economic event”
- Re-established credit
- Completed HUD-approved housing counseling
Under #2, an “economic event” is something beyond your control that reduced your income or caused you to lose employment. If your household income dropped by 20% or more for at least six months, it may count as an “economic event” out of your control.
To re-establish credit, you simply must have 12 months of satisfactory payment history, with no delinquencies. You must have no more than one 30-day delinquency with other (non-housing) creditors, and a capacity analysis must be conducted regarding repayment of open collection or judgment accounts.
How to Apply
In order to start an application with a FHA-lender you must first take a “Pre-purchase counseling” course with a qualified housing agency. Counseling assesses your debt level, your ability to afford the mortgage, features of a mortgage, explains mortgage insurance, the loan application process, and selecting an affordable home. Credit.org is a HUD-approved housing counseling agency, and can help you make sure you’ve done everything you need to do to access the “Back to Work–Extenuating Circumstances” program. You’ll need to get your counseling between 30 days and six months before you apply for a new FHA mortgage.
Go to: BackToWork.org to request pre-purchase counseling and get your certificate so that you can apply for the FHA Back to Work program.