HUD has made an effort to increase homeownership opportunities for borrowers that have experienced financial difficulties due to the recent economic downturn. They have expanded their underwriting guidelines to make qualifying for an FHA loan easier. As a result, it is easier for mortgage companies to meet the high demands of borrowers with damaged credit, such as from foreclosure or bankruptcy.
The FHA Back-To-Work program is simple: If you truly lost your home or filed for bankruptcy due to unexpected job related financial hardship, then HUD is willing to give you a second chance on home financing in Florida.
In simple terms, this expanded guideline helps borrowers that have specifically had a short sale, foreclosure, deeds-in-lieu, or bankruptcy due to financial hardship that has now been overcome. In other words you could not have strategically defaulted on your mortgage due to real estate market meltdown and now expect the government housing authority to assist you in your new home financing needs.
Until recently, FHA financing in Florida typically required a 2 to 4 year waiting period when a borrower had experienced a major derogatory event such as a foreclosure or a bankruptcy. However, this exception on the standard waiting period to qualify for an FHA loan under the FHA Back to Work Program has been waived only for a borrower that can truly meet the following 3 criteria:
Here are the two most important factors taken into account when an FHA approved underwriter examines a borrower’s eligibility to purchase a home via FHA financing after an unintended economic event: