Recently, the Federal Housing Administration moved to relax its guidelines and expedite the waiting period to secure a mortgage for borrowers who “experienced periods of financial difficulty due to extenuating circumstances”. The program exemplifies the FHA’s willingness to help those who have endured a financial situation beyond their control. The program is generally known as the “Back to Work Program” and has assisted consumers securing a mortgage one year after the following economic hardships:
Chapter 7 bankruptcy
Chapter 13 bankruptcy
In order to qualify, the mortgage applicant must meet several minimum eligibility standards. The first is that you must have experienced an “economic event” (e.g.; pre-foreclosure sale, short sale, deed-in-lieu, foreclosure, Chapter 7 bankruptcy, Chapter 13 bankruptcy, loan modification, forbearance agreement). The second is that the applicant must demonstrate a full recovery from the event. Third, the applicant must agree to complete housing counseling prior to closing a “Back to Work Loan.”
The above mentioned program may be a strong option to help a consumer who has endured a financial hardship to once again enjoy pride of home ownership and obtain such ownership on an expedited track. Such a program has the potential to stimulate the housing economy by creating more demand for the purchase of residential housing. As a lawyer that regularly helps those in financial distress, I am eager to advise my clients about this potential option.
See also: New Mortgage Rules to Go into Effect
Should you have any questions regarding the aforementioned blog entry or if you have any questions regarding Bankruptcy and/or Family Law, please do not hesitate to contact the lawyers at Sadek Bankruptcy Law Offices.
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