September 14, 2015
From time to time we get questions in the comments section about legal issues associated with an FHA home loan transaction.
One of the most recent involved a situation where a reader tells us:
“…the underwriter denied loan due to not enough in account for closing. The sellers realtor contacted our loan officer and asked if we had enough money to pay the closing costs our loan officer told her no, at that point the sellers realtor stated they did not know if they wanted to deal with us. Is that legal for our loan officer to give the sellers realtor this information…”
It cannot be stressed enough that in situations where there is a legal question, a lawyer with experience in real estate law should be consulted.
We cannot dispense legal advice, and since real estate laws may vary from state to state, it is always best to consult a local lawyer who knows the law well enough to give sound advice.
Borrowers should always contact the FHA directly when there is suspicion of unusual or improper practices involved with an FHA loan transaction. That is not to say that what the reader has described is unusual, unlawful, unethical, etc.
We’re simply pointing out that a borrower’s first line of defense against practices that ARE unlawful or unethical is to contact the FHA to get advice on the matter.
Borrowers and potential borrowers who do not report these things to the FHA likely won’t ever know for certain what the truth of the situation is, unless a legal expert gets involved. In such cases the FHA may be contacted at some point and depending on circumstances, the agency may choose to get involved directly.
If you need advice or assistance on an FHA loan issue such as the one described here, contact the FHA at their toll-free number: 1-800 CALL FHA.
Do you work in residential real estate? You should know about the free tool offered by FHA.com. It’s designed especially for real estate websites–a widget that displays FHA loan limits for the counties serviced by those websites.
It is easy to spend a few seconds customizing the state, counties, and widget size for the tool; you can copy the code and paste it into your website with ease. Get yours today: http://www.fha.com/fha_loan_limits_widget
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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