Last week we wrote about a controversial new rule being instituted by FHA (Read: FHA Makes it Tougher to Get FHA Loans). This rule was a significant change and affects anyone who wants to buy a home with an FHA loan. Previously, if you had a credit dispute with a creditor (i.e. an old unpaid medical or credit card bill) it would be up to your lender to decide if this would cause your loan to be denied. The rule change removed that decision from the lender. If you had a dispute for more than $1,000, FHA had to make that determination, which basically means you are denied.
This rule was slated to take place 4/1/2012, but now it has been delayed. FHA is now postponing this change until July. The delay is happening to further investigate, define and explain the rule. It is predicted that 10% of sales will be affected by this rule change, so they want to make sure that they are making a good, fair change and that everyone understands the rule.
We were concerned that many people searching homes needing these loans would no longer be able to purchase their homes. This is great news. It means you still have time to start your search for California homes with us now and close escrow before this rule will take place. However, you need to move quickly. It takes about 45-60 days to close an FHA loan, so you will need all the time you can get.
Contact us today at 1-800-287-1808 so we can help you with your search.
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