Any more info or thoughts on this?
Excerpt:
[Mel Watt] . . . announced on Tuesday they would shift strategies by making credit more available to homeowners.
Watt will therefore relax the payment history requirements for banks to get relief from buybacks and also get more clarity on which loans have passed a "quality control."
The moves appear to signal that Watt is placing more emphasis on credit eligibility, while his predecessor focused on protecting and shrinking Fannie Mae and Freddie Mac. Watt's announcements could reduce costs for both banks and borrowers.
In another move to open up credit to first-time homebuyers specifically, HUD Secretary Shaun Donovan announced a new four-year pilot program at the Federal Housing Administration (FHA) starting this fall. The FHA is the government mortgage insurer for low down payment loans.
Under the program, first-time homebuyers who commit to credit counseling will qualify for reduced FHA insurance premiums on their loans. For the average FHA loan balance of $180,000—these reductions, according to Donovan, can add up to roughly $10,000 in savings over the life of the loan.
Starting Score: 2/2013 EQ 535
I would like to see "PMI not for the life of the loan"
@ ezdriver: This isn't the Back to Work Program - it's a new initiative. But sure, I hear you. I think the problem is that a lot of lenders have been afraid of the Back to Work Program and that's a failure on a number of levels.
Some people have had success with the Back to Work Program - there are stories on the fora.
"Cynical."
No - I agree with you. I think these programs rarely do what they think they'll do.
It's frustrating to hear so few lenders are working with the Back to Work program. I stopped payments on my mortgage in 2010, after being out of work for a year and exhausting my savings so as to not default on the loan (and spending $3k to repaint the exterior when I tried to sell). The lender refused to work with me (I kept all the emails back and forth) and they didn't foreclose until 2 years after I contacted them for help and stopped paying. So I'm still within the three year window and I do meet the extenuating circumstances. I found a job a few months after I stopped paying and moved 1500 miles and am now about to start my 5th year with that company. I haven't yet started looking for a lender to work with me.
@songsofexperience wrote:"Cynical."
No - I agree with you. I think these programs rarely do what they think they'll do.
It's frustrating to hear so few lenders are working with the Back to Work program. I stopped payments on my mortgage in 2010, after being out of work for a year and exhausting my savings so as to not default on the loan (and spending $3k to repaint the exterior when I tried to sell). The lender refused to work with me (I kept all the emails back and forth) and they didn't foreclose until 2 years after I contacted them for help and stopped paying. So I'm still within the three year window and I do meet the extenuating circumstances. I found a job a few months after I stopped paying and moved 1500 miles and am now about to start my 5th year with that company. I haven't yet started looking for a lender to work with me.
I feel your pain. Similar situation with me. Got sick of Wells Fargo not wanting to work with me on a payment plan so I walked away from the house in early 2010. They foreclosed immediately. I filed ch7 in late 2012 and received discharge one year ago. I meet all of the requirements of the Back To Work program but the lenders are adding their own requirements on top ... making it very difficult to get through the process. My new home is being built and will be complete in mid-June. If I don't secure a mortgage under this program, I will go back to renting and retry in April of next year when my discharge would be two years old. Arrrrgggggg!
From hud.gov website...
A Chapter 7 bankruptcy (liquidation) does not disqualify a borrower from obtaining an FHA mortgage if at least two years have elapsed since the date of the discharge of the bankruptcy. Additionally, the borrower must have re-established good credit or chosen not to incur new credit obligations. The borrower also must have demonstrated a documented ability to responsibly manage his or her financial affairs. An elapsed period of less than two years, but not less than 12 months, may be acceptable if the borrower can show that the bankruptcy was caused by extenuating circumstances beyond his or her control and has since exhibited a documented ability to manage his or her financial affairs in a responsible manner. Additionally, the lender must document that the borrower's current situation indicates that the events that led to the bankruptcy are not likely to recur.