Warmer Weather, Tougher Qualifying

  • March 1, 2015

When it comes to getting the Financial Assessment done on time and overseeing a smooth transition, it seems that HUD is still trying to get it right.  But it looks like this new date is for real….April 27, 2015.  The decision to postpone this watershed event after announcing a March 2 date was a good one and it’s a great one for borrowers!

The new rules will certainly make it tougher for  elderly Americans to unlock the equity in their homes. The process will be much more laborious and lenders will no doubt have to pass on the cost of added regulatory requirements to borrowers.  There is no question that many seniors will not qualify once the financial Assessment takes effect on April 27.

For some that is probably a good thing since their best option may be to sell and relieve themselves of the taxes, insurance and maintenance of their home.  My concern, and nothing can be done about it but to beat the deadline, is that the rules are a bit overzealous.  Treating a senior on a fixed income who does not ever have to make payments in a way even approaching the very difficult lending standards for a 40 year old in their prime earnings years is a tough stance.  Talk to anyone in the traditional loan application process.  It’s quite an examination and you have to pass with flying colors!

But HUD’s intentions are good and we still have a choice.  That April 27th date is the deadline for getting an FHA case number. HUD Counseling Agencies will back up with people anxious to beat the deadline.  The March 2 date caused an obvious rush to counseling.  This will be the same. There is no question that backups will occur.

I can help with identifying counseling agencies that are best prepared for the increased activity.  To get an FHA case number prior to April 27 means people should schedule counseling now.  I can show people how to avoid any upfront cost for that and it does not obligate anyone to anything.  It just assures that they can get in line and not stress about the deadline.

Here is a letter that we are sending to prospects.  I have addressed it my LinkedIn contacts in general.