September 11, 2015
On September 14, 2015, the new HUD policy handbook on FHA single-family home loans goes into effect. There are plenty of changes, revisions and other statements of policy. Borrowers should know that certain changes have already gone into effect as of March, others won’t be effective until September 14.
Once the handbook is launched officially, lenders will use it to refer to when in need of FHA loan policy or clarification of that policy. Consider one important issue for certain FHA loan applicants including military members and incapacitated borrowers–the use electronic signatures and/or of a Power Of Attorney in order to advance the FHA loan application.
In HUD 4000.1, Chapter Two, Section A has a section titled, “Policy on Use of Electronic Signatures” which includes the following definition:
“An Electronic Signature refers to any electronic sound, symbol, or process attached to or logically associated with a contract or record and executed or adopted by a person with the intent to sign the record. FHA does not accept an electronic signature that is solely voice or audio.”
“Digital signatures”, Section A adds, “are a subset of electronic signatures.” “An electronic signature conducted in accordance with the Electronic Signature Performance Standards (Performance Standards) is accepted on FHA documents requiring signatures to be included in the case binder for mortgage insurance, unless otherwise prohibited by law. Electronic Signatures meeting the Performance Standards are treated as equivalent to handwritten signatures.”
When it comes to powers of attorney, the FHA loan rules begin by defining who must sign certain documents. “All
Borrowers must sign and date the initial and final Fannie Mae Form 1003/Freddie Mac Form 65, Uniform Residential
Loan Application (URLA). All Borrowers must sign and date page two of the initial form HUD-92900-A, HUD/VA Addendum to Uniform Residential Loan Application, and sign and date the complete final form HUD-92900-A. The application may not be signed by any party who will not be on the Note.”
FHA loan rules do permit the use of a power of attorney, but under specific circumstances and with certain requirements. What are those requirements? We’ll examine those in another blog post.
Do you work in residential real estate? You should know about the free tool offered by FHA.com, designed especially for real estate websites–a widget that displays FHA loan limits for the counties serviced by those websites.
It’s simple 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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