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stoune · Joined: 02 Mar 2010 Posts: 3 2.00 Dollars($)

What does it mean if FHA rejects the mortgage insurance, and lender asks for your current year tax return documents to be presented to FHA, while down payment was 23%, but borrower did not have complete 2 years of employment history in US?
Is there a chance for the mortgage insurance to fell off, or it's bad for the borrower?

jameshogg · Posted: Tue Mar 02, 2010 11:38 pm Post subject:

Hi stoune,

If the borrower does not have an employment history of 2 years, then it will be difficult for him/her to qualify for a loan. These days, lenders are not ready to give a home loan to borrowers who do not have an employment history of 2 years. If the required criteria are not satisfied, the lender will not be ready to give you a loan.

Thanks

tfaulhaber1 · Posted: Wed Mar 03, 2010 5:33 am Post subject:

What field of work is he in? Does he work with the same company? Was he tranferred here. Does he have citizenship? Please explain in more detail.

jveenstra · Posted: Wed Mar 03, 2010 1:16 pm Post subject: FHA

It sounds to me like you already closed and you already have the FHA mortgage. However, for some reason, after the lender closed and sent the paers to FHA for the FHA insurance it was declined. Now the lender has an FHA mortgage that may be on their books.

Anyway, if FHA declined the insurance, the lender is trying to get some documentation so they can get the FHA insurance. You should try to help them do so.

Posted: Wed Mar 03, 2010 11:05 pm Post subject:

I got the home loan before I had complete 2 years of employment history in US.I had to put more than 20% down, and since lender is secure, they granted me the loan.I'm self employed craftsman.

jveenstra · Posted: Thu Mar 04, 2010 6:58 am Post subject: FHA Insurance

Sounds to me like the lender could not get FHA mortgage insurance.

That is bad for the lender, potentially. It is bad for the lender if you do not pay and they have to foreclose. They could lose some money because the loan is not insured.

On the other hand, if you pay, they lose no money except they have a loan that is not insured. The lender has a problem. They are asking for your help. They are asking for your tax return to see if they can get the loan insured. Help them if you can. I have a feeling that as a self employed craftsman, your tax return may not help them.

Sounds like they helped you purchase a property when they really should not have been able to do the loan.

They helped you. You should try to help them.

gmakerley · Posted: Thu Mar 04, 2010 10:13 am Post subject:

i think you've hit it, john. underwriting approved this loan, even though it was an outside the box deal. they probably figured their good record with fha would afford them the opportunity to take a risk such as this and still obtain the insurance.

and i agree that a borrower in this situation ought to be agreeable to help out the lender - they went out on a limb only to see it lopped off, and seek the assistance to try to convince the powers that be at fha that insuring the loan is not only paramount, but a reasonable request.

stoune · Joined: 02 Mar 2010 Posts: 3 2.00 Dollars($)

Shure I'm helping them.The lender offers me to refinance in 15 years loan.That way I will not have PMI and interest will be lower.I will be paying just $200-$250 more a month but will pe payig much less in interest and will go out of debt quicker.I also should get refunded for the PMI premium I have paid.What do you guys think on that?

gmakerley · Posted: Fri Mar 05, 2010 9:02 am Post subject:

stoune, that response baffles me.

jburke · Posted: Tue Mar 09, 2010 4:07 pm Post subject:

The offer to refinance you to a 15 year fixed makes perfect sense for the lender and here's why.

FHA does not require mortgage insurance on the 15 year fixed as long as you put 10%+ down. This could be a win/win for both parties as long as the borrower can comfortably make the payments on a 15 year mortgage.

I would make sure that the lender covers all of the costs and gives you a par rate - this was their mistake and they should eat any and all costs to fix it.
Do not let them roll any costs into your new loan or try and sell you a 15 year fixed rate of anything over 4.25%.

Good luck.

Posted: Fri Mar 12, 2010 6:45 am Post subject:

General question on what you’ve found on mortgage FHA refuses to insure
:
1. Does the UFMIP get returned for application to the principal balance?
2. Can the lender continue to collect the monthly MIP directly in yield compensation for the added risk of a “forced” conventional loan?

money back from the federal government. Anyone out there experienced this?

justinkennedy · Posted: Fri Mar 12, 2010 10:43 am Post subject:

in my opinon this lender did not help this person. They did not correctly complete the loan to FHA standards. HUD is keep thier eye out on these broker and bankers bending the rules to close a loan. a true honest company would have complied with the FHA 4155.1 and .2 handboks and declined the loan. instead of enjoying a new home and focusing on thier daily tasks this client needs to jump thru hoops to resolve thier "loan un-profressional's" lack of skill and knowledge.
to say they help him is not correct. as long as this client did not submit fraudulate documents and every thing was above aboard go on with your life
it is thier problem for bending the rules

gmakerley · Posted: Tue Mar 16, 2010 10:27 am Post subject:

hard to get through what you said there, justin, but it still has value. i agree that the lenders who are trying to cut corners are doing a major disservice to their clientele.

and to "guest" - no way in the world could the lender keep the mip in order to boost its profits.

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FHA rejects Mortgage Insurance