FHA offers Back to Work Loans for Mortgage Seekers

Anyone who has been through a financial crisis can understand how difficult the situation can get. After a period of financial hardship, it can be very challenging to start anew. For millions who lost their homes to a short sale, bankruptcy or similar hardships, seeking a new home loan meant that they had to wait for up to 3 years before they could apply for one. FHA launched the Back to Work lending program on August 15, 2013, with a view to help families still going through an unfortunate economic event. With this lending program, borrowers could apply for a home loan again just after a year of an economic event.

The Federal Housing Administration(FHA) defines an economic event as “any occurrence beyond the borrower’s control that results in loss of employment, loss of income or a combination of both, which causes a reduction in the borrower’s household income of 20 percent or more for a period of at least six months.” The household income includes the overall income of a household, not just one member.

Economic hardships such as a prior short sale, deed-in-lieu, forbearance agreement and loan modification are often beyond a borrower’s control. If a family can provide documented proof of an economic event and also prove that their credit score has been showing an upward trend for at least one year, Back to Work mortgage lenders can consider the family for this lending program.

Reentering the market is an important decision for families after they have been through financial hardship. However, before they apply for a second chance at home ownership, the FHA requires that the borrowers must undergo a 1-hour housing counseling session with an agency approved by them. This session could be completed in person, over the phone or online. The session takes a look at the economic event the family has been through and how a similar situation may be avoided in the future.

Housing counseling helps borrowers understand their financial situation better. It makes them better aware of options available to them. Once they are a part of this program, the borrower puts down just 3.5% on their new mortgage, with no premiums and fees at closing.

With a negative financial situation, times can be tough. However, with back to work mortgage lenders, borrowers can once again tread on the path of home ownership. The program ends in September of 2016. While there’s still time, borrowers must look for lenders offering this bracket of FHA loans.

If you, or someone you know has been through an adverse economic event, but are committed to getting past the financial hurdles; it is a wise decision to apply for an affordable home loan thorough the back to work program. Why wait further, if you are eligible now?

Back to Work Lending Program: Changing Dreams into Reality

As per data from Realty Trac, a foreclosure listing company, more than 4 million foreclosures were completed between January 2007 and December 2011. Towards the end of December 2011, More than double these numbers of foreclosures were in the process; approximately 8.2 million!

The housing market crash affected millions of families, forcing them to let go of their nest eggs, the homes they owned. The struggling economy is still on its way to recovery. People who have lost their homes due to a financial crisis try their best to face the situation. They are committed to paying off their debts, committed to improving their credit scores and are now re-entering the market in a much stronger position.

FHA’s back to work lending program has raised the hopes of affected families. The program, launched on August 15th of 2013, is aimed at helping creditworthy Americans who are now re-employed and wish to re-build their home.

Under this program, borrowers who have been through extenuating economic hardships can re-enter the market just a year after losing their home and obtain an FHA mortgage. Earlier, borrowers had to wait for at least three years before they could apply for a government loan. The back to work lending program has been welcomed by borrowers across America, who have found a new hope for their dream home.

However, there are certain strings attached to this opportunity! Not all borrowers can take part in the program. Let us talk about what qualifies one to benefit from this program.

Borrowers must prove their difficult economic circumstances such as a bankruptcy, short sale, deed-in-lieu or loss of employment, for at least 12 months. They must submit documented proof of their financial hardship. Also, they must show that there has been a 20% reduction in their household income, at least 6 months before they defaulted on the loan.

Further, their credit scores must be good for at least 12 months after the financial event they have been through. A minimum score of 500 is a must, however, those with no credit score can also qualify.

Last but not least, the borrowers are required to take a 1-hour counseling session from a Housing and Urban Developing (HUD) agency at least 30 days prior to filing a new loan application. This may be done over the phone, in person, or online. This counseling helps borrowers understand issues such as loan options and obligations, budgeting, and how to avoid scams; among other things.

With the back to work loan program, many individuals are now able to enter the housing market again by applying for new mortgage loans. The market is definitely seeing a greater number of buyers, with fewer homes lying vacant.

What the affected borrowers need is a helping hand that can lead them to their dream. Choosing the appropriate lender can determine how smooth the process of re-entering the market can be.

The tricky documentation work, choosing an appropriate loan amount and weighing the loan obligations can be daunting subjects for borrowers. Borrowers must work with an experienced lender who can make the complete process much simpler and faster.

Three Things To Know About The FHA’s New Home-Buyer Loans

The FHA’s affordable home-mortgage loans have a new purpose and some new rules

If you are a potential first-time homebuyer or a repeat homeowner who has faced previous financial difficulties, now is a great time to take a step into the housing market for the FHA’s new homebuyer loans.

The FHA created a program designed for anyone who has faced an economic event — any occurrence beyond the borrower’s control that results in a loss of employment or a loss of income of 20 percent or more for a period of at least six months. If you can relate, here are three things you should know about the “Back To Work” program.


1. This loan is designed for families who are regaining financial stability
“Back to Work” was launched to save families who would otherwise be turned away from lending agencies and banks. Since events like foreclosure and bankruptcy stay on a borrower’s credit history for up to seven years, most lending agencies don’t want to risk the chance of a negative event happening again. However, the FHA has recognized that an economic event does not determine whether a borrower can fully recover and repay a loan. The program reduces the long waiting period after losing a home to only 12 months. Normally, families have to wait several years. The program also allows borrowers to put only 3.5 percent down with no premiums or fees at closing.

2. Prospective borrowers must be able to provide proper documentation
Lenders will offer a second-chance mortgage to almost any borrower who qualifies. To be eligible, each person who is signing the loan must be able to provide the lender with proper paperwork that shows proof of a past economic event. The family must also meet general requirements in terms of employment, income and credit. To begin, make clear copies of each signer’s driver’s license and social security card. Gather other necessary items, such as 30 days worth of recent pay stubs, tax returns, W-2 forms, and bank statements. Your statements should include all of your checking and savings accounts, any 401K and other stock accounts. Also be sure to gather the proper documentation for other additional income, such as child support, alimony, Social Security or a pension award. Your lender will need to see all of these items, and possibly a few others, to determine if the “Back to Work” program is right for your situation.

3. The FHA requires participants to complete one hour of housing counseling
For borrowers to become eligible for the FHA’s affordable home-mortgage loans, lenders ask prospective borrowers to complete housing counseling at least 30 days, but no more than six months prior to submitting a loan application. Counselors are required to address the cause of the economic event to ensure borrowers know how to avoid making the same mistakes twice. They also help families create and assess a household budget and teach them how to avoid scams. The overall goal of counseling is to better prepare families for future financial shocks and instill good financial habits.

Back to Work Program Lenders Redefine Mortgage Guidelines

Home mortgage loans are less complex through the FHA’s new program

Families who have struggled with financial hardships now have a more efficient option that allows first-time homebuyers and repeat homeowners to quickly apply for second-chance home mortgage loans.

The “Back to Work” program helps families who have faced an economic event like foreclosure, short sale, deed-in-lieu, bankruptcy, loan modification or forbearance agreement. These families are now able to apply for a new mortgage only 12 months after losing a home. Previously, the waiting period after such events was oftentimes greater than three years.



For millions of families who are still battling with the U.S. housing crash of 2008, the program is nearly a miracle. If the down payment you are able to make is less than 20 percent, a Federal Housing Administration (FHA) loan is right for you. Through “Back to Work,” borrowers may put down only 3.5 percent with no premiums or fees at closing.

Prospective borrowers may be eligible to apply if they are working again, possess a steady income and can prove previous extenuating circumstances through proper documentation. Participating borrowers must be able to meet general guidelines that involves employment, income and credit.

Lenders ensure borrowers have re-established a steady financial life through credit history reports. To be eligible, borrowers must have a 12-month credit history that is clear of late housing, installment debt payments, delinquency and other derogatory credit issues. Prospective participants with credit scores below 500 are not accepted, but those with no credit history whatsoever remain eligible.

If a prospective homeowner has open collections or any judgment accounts, a “capacity analysis” will be completed to determine if the borrower will be able to afford repaying other creditors and a new mortgage simultaneously.

Although an economic event will stay on a borrower’s credit history report for up to seven years, it’s never too late to start recovering. In fact, the FHA requires that all “Back to Work” participants complete at least one hour of one-on-one housing counseling to ensure they have a better understanding of how to become and stay fully recovered.

Counselors teach borrowers how to create and assess a household budget. They also help borrowers avoid scams and become better prepared for future financial shocks. Oftentimes, borrowers just need a small push to regain financial confidence, avoid poor spending habits and a routine of paying bills on time.

To begin the path back to homeownership, interested borrowers may connect with any lender that offers the “Back to Work” program. Borrowers should find a lender that has experience dealing with many other cases of extenuating circumstances. The loan is offered through Sept. of 2016 and can be found in all 50 states. “Back to Work” program lenders will evaluate previous hardships and affordability to ensure the program is right for each family’s situation.

Who Are Looking For Back to Work Mortgage Lenders

Gain these traits to participate in the “Back to Work” home loan program

If you are hoping for a second chance in the housing market after an economic event like foreclosure, short sale or bankruptcy, it’s not too late to apply for a new loan that could change your financial life. The FHA’s Back to Work home loan allows borrowers to put only 3.5 percent down with no premiums or fees at closing. The program, which is designed for families who have previously had financial hardships, runs through September of 2016. If you’re looking to get back on your financial feet with a new mortgage, you must first prove you have what it takes. Here are exactly the types of borrowers that Back to Work mortgage lenders are looking for.

Borrowers who have taken housing counseling
The FHA requires that all “Back to Work” participants attend at least one hour of housing counseling with an agency approved by the U.S. Department of Housing and Urban Development. Housing counselors help in the creation and assessment of a household budget. This helps eliminate unnecessary spending, ensuring you will have plenty of financial support for your new mortgage. Counselors also teach how to avoid scams and how to become better prepared for future financial shocks.

Borrowers who have satisfactory credit
Having a good credit score shows that you are a responsible candidate who will repay a mortgage back on time — a “good risk.” Since lenders have to trust that you will maintain a steady job and continuously show financial stability through a nearly lifelong commitment, they want to see that you can prove your creditworthiness. To be eligible in the program, borrowers must have a 12-month credit history that is clear of late housing, installment debt payments, delinquency and any other derogatory credit issues. Borrowers with credit scores below 500 are not accepted, but borrowers with no credit score whatsoever remain eligible.

Borrowers who have the proper documents
Before visiting a lending agency that offers the program, take time to gather the necessary documents you will need to prove you have fully recovered from your previous economic event. Bring bank statements from the past two or three months, including all checking and savings accounts, as well as any 401k or stock accounts. If you receive any additional income, such as child support, Social Security, alimony or a pension award, bring paperwork that provides proof. Make clear copies of both your driver’s license and your social security card. Most “Back to Work” lenders will also want to see tax returns and at least 30 days worth of pay stubs. Anyone who is signing the loan, including all cosigners, must be able to provide proper paperwork to be eligible. Some agencies list on their websites which documents you will need to begin a new mortgage.

The Best Home Mortgage Loans by The FHA

New home-buyer loans could save millions of families if they qualify

Qualifying for a new mortgage after a financial crisis isn’t easy. Millions of families are still recovering from the housing crash of 2008. The Federal Housing Administration (FHA) recognized the problem last summer when it launched its “Back to Work” lending program, which offers today’s best home mortgage loans for recovering families.

The program is designed for families that have faced an economic event that caused a loss of employment or income of 20 percent or more for a period of at least six months. This includes foreclosure, short sale, deed-in-lieu, forbearance agreement, Chapter 7 bankruptcy, Chapter 13 bankruptcy and loan modification.

These new home-buyer loans offer a second chance at the American dream with a shortened waiting period. In fact, families can now apply for a new mortgage only 12 months after losing a home. Outside of the program, the waiting period after losing a home typically lasts several years.

Am I eligible to participate?
Eligible borrowers must first meet basic requirements by the FHA that include basic standards for employment, income and credit. Next, the main borrower and any co-signers must be able to prove they have faced an economic event. This can be shown through W-2 forms or almost any document that shows a loss of employment or income.

Most importantly, lenders look for prospective borrowers who have made a full recovery since the occurrence of the economic event. Borrowers must have credit scores higher than 500. Your 12-month credit history report should be clear of late housing, installment debt payments, delinquency and any other derogatory credit issues. Borrowers with no credit score whatsoever remain eligible.

If you have had trouble making on-time payments, try setting up automatic payments through your bank’s online system. It’s an easy and convenient way to ensure you will never miss deadlines. Lenders also like to see that prospective borrowers are far below their credit limits. Although it’s easier said than done, try paying down your debts as much as possible.

Last, but not least, the FHA requires all “Back to Work” participants to complete housing counseling. The session must last at least one hour with an agency approved by the U.S. Department of Housing and Urban Development. Counseling should also be completed at least 30 days, but no more than six months prior to submitting a loan application. If you are in this range of time, a list of approved agencies can be found at www.hud.gov.

Counselors help borrowers create and assess a household budget. This will ensure your family and lending agency that you know how to make smart spending decisions and will be able to make your mortgage payments in full every month. Interested borrowers should speak with a lender that offers “Back to Work,” which is offered in all 50 states through Sept. of 2016.

Relive Your Dream with the New Back to Work Lending Program

In the tough economic times of today, it is often very difficult for people to even meet the daily necessities of life. For many Americans, the housing market crash in 2008 came as a final blow, and many families lost their homes. Thousands are still struggling to cope with the aftermath and are struggling to get back on the journey to home ownership.

The New back to work lending program is a ray of hope for affected families to reenter the market through a new mortgage loan. Families affected by adverse economic events such as the pre-foreclosure sale of a house, a short sale, bankruptcy or forbearance agreements, can now get back to home ownership.

What is the back to work lending program?
Designed to give another fair chance at a successful mortgage to families affected by an economic downturn, this program was launched in August 2012. The Federal Housing Administration (FHA) insures mortgage loans in all 50 states, including the District of Columbia.

How does back to work lending help?
Since the program waives the 3-year waiting period, families can apply for a new mortgage after just one year of losing their home. Before applying, families have to undergo counseling for at least one hour by a housing counselor. Issues such as credit issues, home investment, reverse mortgages and foreclosure avoidance are discussed at length. This is a mandatory session and must be completed at least 30 days prior but no more than 6 months before they apply for the new loan.

Although, the mortgage rates are almost the same as FHA loans, by being a part of the new back to work lending program, borrowers may put down just 3.5% on a new mortgage. Also, they don’t have to bear a premium on their interest rate or additional fees at closing.

Eligibility conditions:

• Borrowers must work with a home mortgage lender who offers the back to work program.
• Borrowers must have been through an adverse economic event.
• Borrowers must be able to reflect their ability and disposition to make regular monthly payments.
• Borrowers must attend a counseling session on home ownership.
• In the last 12 months prior to applying for the new home mortgage loan, borrowers must reflect a fair credit history. There must not be any delinquency in the past one year of applying.

If home owners can prove their past economic hardships, their full recovery and complete the housing counseling, a back to work loan is just right to help them. Borrowers aspiring to own a home again must find a FHA-approved lender to get started. It will only be a matter of time before they move into their new home.