FHA loan and rehab student loan

[Anonymous]

I defaulted on a federal student loan.  I entered a rehab program in June 2008.  It required 9 months of on-time payments, but that time came and went long ago and no lender was found to pick up the loan.  It's been over a year and a half and since I'm still in the rehab program, I'm technically still in default even though I pay monthly.

So, my question is - if I don't have enough for conventional but have the scores/down payment necessary for FHA, is this going to be a deal breaker?  Do they care about the fact that no lender has been found?  My only alternative is to consolidate, which is going to ding my fico scores...

The SL guarantor offered to write a letter, but if the FHA rules are firm, it looks like I'm stuck.  I should have been rehabbed this time last year.    Then they said October at the latest.  Now they're saying maybe by May.  Meanwhile, realistically I can only come up with 10% down and scores are 651 and 689, so conventional is out of reach.

Message Edited by helplessintn on 03-01-2010 03:25 PM

[mauve]

FHA has a 3.5% option - i don't know what to tell you about the rest!  You should be able to find resources for your specific state. 

Message Edited by mauve on 03-03-2010 01:31 PM

[Anonymous]

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@mauve wrote:
FHA has a 3.5% option - i don't know what to tell you about the rest!  You should be able to find resources for your speific state. 

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Thanks for responding. 

Has anyone else seen this scenario?  Is it useless to apply until a lender is found for my rehab student loan?