FHA Loan

California is offering free money for mortgages while making a push to get homeowners into a 2 billion dollar foreclosure prevention program, and as a result, you could see a principal reduction on your mortgage if you qualify. The program is called Keep Your Home California, and it’s been around since last year but most lenders didn’t participate in it because the program required the banks to match taxpayers funds when homeowners received a mortgage reduction through the program. That requirement has been eliminated and now Fannie Mae & Freddie Mac are all aboard, and they own 62% of the mortgages in California. The changes to the program should be available in June, and eligible homeowners can receive up to $100,000 in principal reductions or money to pay their mortgage. If you want more information to see if you qualify, just go to their website.

Many veterans today are wondering whether or not they can get an Idaho VA Mortgage loan if they have recently been through a foreclosure.

Fortunately, the VA qualifying guidelines do allow for veterans and military personnel to qualify for an Idaho VA loan after a foreclosure, but with some restrictions.

For starters, veterans are not eligible for a VA loan for 2 full years after their foreclosure. After this time veterans are allowed to apply for a loan again, but will face increased scrutiny and will likely have to respond to more questions during the application process.

Remember, while you are eligible to apply for a VA loan after 2 years, there are additional requirements that must be met which may vary by lender. Simply waiting out the recovery period does not guarantee you loan approval.

Also keep in mind that this rule does not only apply to veterans who previously had a VA loan. Even veterans who have had conventional mortgage foreclosures are subject to the same regulations.

For veterans who do have a recent foreclosure that involved a VA loan, there are additional restrictions.

First, to restore full entitlement after a VA loan foreclosure, the borrower has to completely pay back the VA the loss of the previously guaranteed amount.

It is possible to use partial-entitlement to get a VA loan, but without full entitlement a down payment will probably be required. Borrowers with past foreclosures will also be asked to provide details regarding the circumstances. If you can show that the cause of your financial trouble and foreclosure were largely out of your control, you may be able to increase your chances for approval.

Some examples of extenuating circumstances include:

• Unforeseen medical bills.

• Job loss.

• Certain lawsuits.

Examples of circumstances which probably won’t be considered to be extenuating are:

• Bankruptcy because of an entrepreneurial business venture.

• Getting divorced.

• Certain lawsuits.

Regardless of the scenario, there is no guarantee of approval or denial as decisions are made on a case-by-case basis.

Lastly, even though the VA does not disqualify veterans from VA loans after a foreclosure, it can definitely make the application process take longer than it normally would.

Frequently Asked Questions:

Q: What is a VA Guaranteed Home Loan?

A: VA guaranteed home loans are loans made to eligible veterans for the purchase of a home as their primary residence. The guaranty means the lender is protected against loss if you fail to repay the loan. The guaranty replaces the protection the lender normally receives by requiring a down payment allowing you to obtain favorable financing terms.

Q: Does my entitlement guarantee that I will get a home loan?

A: No VA cannot compel a lender to make a loan that would violate their lender policies.

Q: How much is my entitlement?

A: Your basic entitlement is $36,000. For loans in excess of $144,000 to purchase or construct a home, additional entitlement up to an amount equal to 25 percent of the Idaho VA county loan limit for a single family home may be available .  This means that qualified veterans could get a no down payment purchase loan for those amounts.

Q: How do I apply for a VA guaranteed loan?

A: You can apply for a VA loan with my company who is a mortgage lender that participates in the VA home loan program. At some point you will need to get a Certificate of Eligibility from VA to prove to the lender that you are eligible for a VA loan.

Q: How do I get a Certificate of Eligibility?

A:  Complete a VA Form 26-1880, Request for a Certificate of Eligibility. You can apply for a Certificate of Eligibility by submitting a completed VA Form 26-1880, Request for a Certificate of Eligibility for Home Loan Benefits, to the Winston-Salem Eligibility Center, along with proof of military service.

Q: Can my lender get my Certificate of Eligibility for me?

A: Yes, it’s called Web LGY. Most lenders have access to the Web LGY system. This internet based application can establish eligibility and issue an online Certificate of Eligibility in a matter of seconds. Not all cases can be processed through Web LGY – only those for which VA has sufficient data in our records.

Q: What is acceptable proof of military service?

A: If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which identifies you and your social security number, and provides your date of entry on your current active duty period and the duration of any time lost.

If you were discharged from regular active duuty after January 1, 1950 a copy of DD Form 214, Certificate of Release or Discharge From Active Dutyshould be included with your VA Form 26-1880. If you were discharged after October 1, 1979, DD Form 214 copy 4 should be included.

If you are still serving on regular active duty, you must include an original statement of service signed by, or by direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters which shows your date of entry on your current active duty period and the duration of any time lost.

If you were discharged from the Selected Reserves or the National Guard, you must include copies of adequate documentation of at least  6 years of honorable service. If you were discharged from the Army or Air Force national Guard, you may sumit NGB Form 22, Report of Separation and Record of Service, or Reserve, you may submit a copy of your latest annual points statement and evidence of honorable service. Unfortunately, there is no single form used bythe Reserves or National Guard similar to the DD Form 214. It is your responsibility to furnish adequate documentation of at least 6 years of honorable service.

If you are still serving in the Selected Reserves or the National Guard, you must include an original statement of service signed by, or by the direction of, the adjutant, personnel officer, or commander of your unit or higher headquarters showing length of time that you have been a member of the Selected Reserves. Again, at least 6 years of honorable service must be documented.

Q: How can I obtain proof of military service?

A: Standard Form 180, Request Pertaining to Military Records, is usd to apply for proof of military service regardless of whether you served on regular active duty or in the selected reserves. This request form is not processed by VA. Rather, Standard Form 180 is completed and mailed to the appropriate custodian of military service records. Instructions are provided on the reverse of the form to assist in determining the correct forwarding address.

Q: I have already obtained one VA loan. Can I get another one?

A: Yes, your eligibility is reusable depending on the circumstances. Normally, if you have paid off your prior VA loan and disposed of the property you can have your used eligibility restored for additional use. Also, on a one-time only basis, you my hae your eligibility restored if your prior VA loan has been paid in full but you still own the property.

Q: Is the surviving spouse of a deceased veteran eligible for the home loan benefit?

A: The unmarried surviving spouse of a veteran who died on active duty or as the result of a service-connected disability is eligible for the home loan benefit. In addition, a surviving spouse who obtained a VA home loan with the veteran prior to his or her death (regardless of the cause of the death), may obtain a VA guaranteed interest rate reduction refinance loan.

If you have any questions about a VA home loan feel free to contact me.

Michelle Guth
Diversified Mortgage Group
Branch Manager/Owner
Direct: 208-475-0865
Loanswithmichelle@gmail.com
ID MBL-5696 / NMLS # 36853 / 36852 / 1850
HTTP://FINDYOUAHOMELOAN.COM

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Many people in California wonder how long they need to wait after a foreclosure, short sale, or bankruptcy before they can buy a home again. In this funny phone call parody with Nicolas Cage, he learns exactly what thewaiting periods are before you can buy a house again if you have had a bankruptcy, short sale or foreclosure, and what you should be doing to repair your credit while you are waiting to purchase a home again to make sure that you are ready to get your loan faster. If you’re thinking about owning a home again in San Jose, be sure to call your local San Jose mortgage broker, Rich Iacovetta with RMI Lending.

In foreclosure news, San Jose banks must offer foreclosure alternatives quickly to help you keep your property in California. If you’re already behind on your mortgage, or waiting for months just to hear back from the bank to find out if their willing to modify your loan, Fannie Mae and Freddie Mac are gonna start to lay the smack down on your bank. Starting January 1st, if you are more than 30 days late on your payment, your bank will be required to send you a packet in the mail offering you alternative options to foreclosure. When you let them know which option you want to take, they’ll have just 30 days to evaluate you as a borrower to see if you refinance or modify your loan. Then they will decide which course of action they think is the best alternative for you. Now this doesn’t mean that they HAVE to make sure you are approved for a modification or principal reduction, it just means they can’t keep you hanging on waiting for an answer. If they do, they’ll be hit with a $500 fine for not getting back to you. Now, with the average underwater homeowner being upside down about $65k on their home already, a $500 fine to the banks will just be a drop in the ocean of their bigger problems.