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FHA Back to Work Program

If you’ve gone through a short sale, foreclosure, bankruptcy, or deed-in-lieu, you no longer need to wait to apply for an FHA-backed loan, as long as you meet several minimum eligibility requirements.Buying a House After Foreclosure or Short Sale

The Federal Housing Administration (FHA) published guidelines for its “Back to Work – Extenuation Circumstances Program” last year, but many lenders had not yet participated in the program. But now Guaranteed Rate Mortgage announced they have adopted this program.  Shant Banosian of Guaranteed Rate says this program allows borrowers who lost their homes due to a loss in employment or income to be eligible to apply for an FHA-backed mortgage in as few as 12 months after a short sale, bankruptcy, foreclosure, or a deed-in-lieu.

View Waiting Periods to Purchase After a Short Sale, Foreclosure, or Bankruptcy

Qualifications for FHA Back to Work Program:

Under the program, borrowers who experienced what FHA calls an “Economic Event”—the loss of employment, income, or a combination of both, which caused a reduction in the borrower’s income of 20% or more for at least 6 months—resulting in the loss of their home, will be considered for an FHA-backed mortgage as long as they can document:

  • They had good credit prior to the event, and that the event caused the bad credit
  • The borrower has fully recovered financially from the event for 12 months
  • The borrower completes housing counseling

Lenders will determine if a borrower’s credit is satisfactory if their credit history is clear of late debt payments, the delinquencies occurred as a result of the event, and they show 12 months of on-time payment history. The borrower must have returned to work for at least 6 months prior to application.

Find Out If You Qualify for FHA Back to Work Program:

Or Call 1-800-924-6563