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Articles in Category: HUD Regulations

September 10, 2012

FHA Loan Reader Questions: Is A Physician Statement Required as Proof of Income for Disability Compensation?

By Joe Wallace

A reader asks, “I have been approved for an FHA home loan or so my loan officer told me. She said everything was good I had been approved, a closing date was selected and ten minutes later I get a text message from my loan officer that the underwriter requires one more document.” “I am on Social Security Disability, proof of all income was provided, but now the underwriter wants a letter from my doctor guaranteeing that my medical condition will not change for the next 3 years! No doctor can guarantee my health or anyone else’s, can the lender suddenly deny my loan? My doctor would look at me like I had totally lost my mind. Please help me with this.” Situations like this happen more often than you | more...

 

September 7, 2012

Seller Concessions, The Six Percent Limit, and Inducements to Purchase

By Joe Wallace

In our last blog post we discussed a reader comment about seller concessions. The reader asked a two-part question; “Has the percentage of incentives a seller can offer a buyer with an FHA loan changed yet from 6% to 3%? What if appliances and other things have been requested by the buyer which were covered under a separate sheet not the official home sale offer sheet?” At the time of this writing the FHA limit is still six percent. Some borrowers may be wondering what is meant by “seller concessions”; the FHA loan rule book describes them as contributions of “up to six percent of the lesser of the property

 

September 5, 2012

FHA Loans and Homeowner’s Association Policies

By Joe Wallace

A recent press release issued by the FHA/HUD announced charges against a Florida homeowner’s association for policies the press release claims are in violation of the Fair Housing Act. According to HUDNo.12-145, “The U.S. Department of Housing and Urban Development (HUD) announced…that it is charging a Gibsonton, FL, homeowners association and its Tampa-based former management company with violating the Fair Housing Act by subjecting a family to different rental terms and conditions because they have six children.” The charges allege, according to the press release, “that Townhomes of Kings LakeHomeowners Association (HOA), Inc., and Vanguard Management Group, Inc., violated the Fair Housing Act by telling the family that they had too many people living in their rental townhouse and threatening to evict them if they didn’t reduce the number of | more...

 

September 3, 2012

GFI Mortgage Bankers Settles Housing Discrimination Lawsuit

By Joe Wallace

The FHA/HUD official site has issued a press release stating that “GFI Mortgage Bankers Inc., a large independent home mortgage firm that concentrates on the New York, New Jersey, and Florida markets, will pay $3.555 million to resolve a lending discrimination lawsuit filed by the Department of Justice and the U.S. Attorney

 

August 28, 2012

FHA Loans, Fair Housing Laws, and Discrimination: What You Can Do

By Joe Wallace

In the month of August, 2012, the FHA/HUD official site reported no fewer than four cases investigated by the Department of Housing and Urban Development related to housing discrimination. In one case, the owners of an Alabama mobile home park were charged with discriminating against an African-American family; another case that reached the settlement stage in Alabama involved discrimination against Hispanic residents. Two more cases, one in West Virginia and another in Minnesota, involved racial bias and discrimination due to a medical condition. FHA loan rules, state laws and federal statutes forbid discrimination of any kind in the housing process. Whether you are applying for a home loan, looking for rental housing, or trying to renew leases or refinance, it is illegal to deny housing for reasons of race, creed, | more...

 

August 14, 2012

Proposed New Rules For Home Loans May Affect FHA Mortgages

By Joe Wallace

The Washington Post and Bloomberg News are reporting on a set of proposed rule changes by the Consumer Finance Protection Bureau that will, if implemented, change the way banks and customers interact on FHA loans, conventional mortgages and VA guaranteed loans. According to an article on WashingtonPost.com, the proposed regulations would “go beyond the standards for mortgage servicing that state attorneys general wrote into a court settlement reached with major banks on March 12” and the measures would also modify existing rules in the Real Estate Settlement Procedures Act (RESPA). At the Consumer Finance Protection Bureau (CFPB) official site, you’ll find a list of proposed changes which includes a requirement for monthly mortgage statements with clear details on loan amounts, the amount due, and how payments are applied to the | more...

 

July 13, 2012

HUD Charges Minnesota Condo Association and Management Company With Fair Housing Act Violations

By Joe Wallace

In spite of federal laws, conventional, VA, and FHA loan applicants sometimes experience discrimination when house hunting. While the most obvious types of discrimination involve bias against race, religion, sexual orientation, or national origin, there’s another type of discrimination that’s just as illegal and unfair–discrimination based on family status. According to a press release issued by the Department of Housing and Urban Development, a Minnesota condominium association and its management company, Gassen Company, Inc., have been charged by HUD with violating the Fair Housing Act, “by discriminating against families with children under the age of 18”. The press release says, “According to HUD

 

July 4, 2012

FHA Appraisal Expiration Dates: Questions and Answers

By Joe Wallace

When buying a home with an FHA guaranteed mortgage loan, one of the most important steps in the process is the appraisal. An FHA appraiser reviews the home to make sure it lives up to minimum property requirements and assigns a fair market value to the property. There are many common questions about FHA appraisals; here are some of them along with the answers. How Long Is An FHA Appraisal Valid? Buyers who purchased property prior to January 1, 2010 may have experienced a different set of standards, but currently, FHA appraisals are considered valid for 120 days. After that time they expire. According to FHA.gov, “Effective for all case numbers assigned on or after January 1, 2010 the validity period for all appraisals on existing, proposed, and under construction | more...

 

July 3, 2012

FHA Loans and Fair Housing Act Enforcement

By Joe Wallace

All lenders, including those who participate in the FHA loan program, are required to comply with Fair Housing Act laws. But in some cases the first line of defense against discrimination is with the borrower who files a complaint after receiving discriminatory treatment in violation of the Fair Housing Act. Fair Housing laws prohibits housing discrimination based on race, color, religion, national origin, sex, disability, or familial status. Borrowers who feel they’ve been discriminated against at any stage of the home buying process should report their complaints as instructed on the FHA official site, which says: “Email or contact us at (800)669-9777 and for the hearing impaired, please call TTY (800)927-9275″. Did you know there is support for such complaints in a variety of languages? Borrowers can find help in | more...