FHA eases mortgage rules for some credit-impaired applicants for collections and charge offs

Collections Accounts, Disputed Accounts, FHA, fha collections, FHA loan, FHA mortgage, fha mortgage loans, judgements, KY FHA LOANS

Kentucky First Time Home Buyer Loan Programs for FHA, VA, KHC, USDA, RHS, Fannie Mae Home Mortgage Loans in Kentucky for 2018

Wholesale-Mortgage-Source-Home-PurchaseFHA Collection Accounts
• A Collection Account refers to a Borrower’s loan or debt that
has been submitted to a collection agency by a creditor.
• Medical Collections are not required to be paid and satisfied.
• Collection accounts of a non-borrowing spouse in a
community property state must be included in the $2,000
cumulative balance and analyzed as part of the Borrower’s
ability to pay all collection accounts, unless specifically
excluded by state law.

If the credit reports used in the analysis show a cumulative
outstanding collection account balances of $2,000 or greater,
the Mortgagee must:
• Verify that the debt is paid in full at the time of or prior to
settlement using an acceptable source of funds;
• Verify that the Borrower has made payment arrangements with the
creditor and include the monthly payment in the Borrower’s DTI; or
• If a payment arrangement is not available…

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