The Federal Housing Administration (FHA) recently introduced a brand new loan program that is designed to help Atlanta home buyers who suffered financial setbacks during the economic recession.
The Back to Work-Extenuating Circumstances Program allows borrowers who lost their home due to financial hardships, such as a short sale, foreclosure or bankruptcy, to become eligible for home loans much sooner than what was previously allowed.
The normal waiting period for someone who has dealt with a bankruptcy is two years, while a short sale or foreclosure waiting period is up to three years. With the new FHA loan program, borrowers can apply for a new home loan in just 12 months.
The federal guidelines require that borrowers prove that they have had a significant reduction in income of at least 20 percent over a six month period through no fault of their own, such as the loss of a job. Borrowers must also be able to prove that they have “fully recovered” from the economic event that caused the loss of their home, they must attend a home counseling program at least 30 days prior to applying for a new loan and they must be purchasing their primary residence. In addition to the program-specific requirements, the borrowers must meet all of the standard FHA guidelines, such as having a satisfactory credit score.
Great information provided by Atlanta Real Estate Forum