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Broker4U
324 Posts |
 Posted - 06/12/2008 : 08:56:45 AM
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| Father and Son own a home... Son is Co-Bowwer... Son wants to buy another home to move out, but Father is dragging his feet on refinancing the home to remove the son. The current loan is FHA. Can the Son still get an FHA as his primary Residency if he can prove that the Dad makes the payments on the other property? My guess is No.... |
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dkendall1979
10298 Posts |
Posted - 06/12/2008 : 09:06:32 AM
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| More information is needed, but the most direct answer is potentially yes. |
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mganovsky
2074 Posts |
Posted - 06/12/2008 : 09:07:01 AM
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| My undrestanding is that you can only have one FHA loan at a time |
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dkendall1979
10298 Posts |
Posted - 06/12/2008 : 09:08:13 AM
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Nope, you're misunderstanding.
quote:
Originally posted by mganovsky
My undrestanding is that you can only have one FHA loan at a time
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BB
989 Posts |
Posted - 06/12/2008 : 09:11:16 AM
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quote:
Originally posted by Banker0679
VA not FHA
quote:
Originally posted by mganovsky
My undrestanding is that you can only have one FHA loan at a time
You can have more than one VA loan at a time if you have enough eligibility. |
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Broker4U
324 Posts |
Posted - 06/12/2008 : 09:11:59 AM
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| They have owned the property since 2003. What else do you guys need... |
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Reegor
484 Posts |
Posted - 06/12/2008 : 09:18:43 AM
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Just document and address upfront. This would only be a problem if left to uw to figure out and question.
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Broker4U
324 Posts |
Posted - 06/12/2008 : 09:34:42 AM
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| That's Awesome!! Yeah he is fine on DTI. Everything looked great until the Dad was being a Douche and didnt want to refi... Even when the rates were 5.5%!!! His current rate is 6.375%. But anyway, I don't want to get into it... All I want to know is how to explain this to my Boss who does not believe me.. Also: Is this a Banks decision on weather or not to take on something like this... or is it something that is common. |
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Broker4U
324 Posts |
Posted - 06/12/2008 : 09:59:46 AM
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quote:
Originally posted by Banker0679
it's common after 1yr of owning the home.
make sure to send in the lox
quote:
Originally posted by Broker4U
That's Awesome!! Yeah he is fine on DTI. Everything looked great until the Dad was being a Douche and didnt want to refi... Even when the rates were 5.5%!!! His current rate is 6.375%. But anyway, I don't want to get into it... All I want to know is how to explain this to my Boss who does not believe me.. Also: Is this a Banks decision on weather or not to take on something like this... or is it something that is common.
Ok... So all I need to do with the application and Documents is submit a LOX about the situation on him being a Co-Borrower and not the actual BWR...? |
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Broker4U
324 Posts |
Posted - 06/12/2008 : 10:14:37 AM
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Well I work for Franklin Bank SSB... So I cant Broker FHA loans. I can do FHA through my bank. And our Rates are good. But I just don't understand why my Branch Manager would be telling me flat out that I cant do it...
quote:
Originally posted by Banker0679
i dont think they will care.
Just submit your file to TBW or Flagstar
Either one of these lenders have common sense underwriting.
quote:
Originally posted by Broker4U
quote:
Originally posted by Banker0679
it's common after 1yr of owning the home.
make sure to send in the lox
quote:
Originally posted by Broker4U
That's Awesome!! Yeah he is fine on DTI. Everything looked great until the Dad was being a Douche and didnt want to refi... Even when the rates were 5.5%!!! His current rate is 6.375%. But anyway, I don't want to get into it... All I want to know is how to explain this to my Boss who does not believe me.. Also: Is this a Banks decision on weather or not to take on something like this... or is it something that is common.
Ok... So all I need to do with the application and Documents is submit a LOX about the situation on him being a Co-Borrower and not the actual BWR...?
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Broker4U
324 Posts |
Posted - 06/12/2008 : 10:52:58 AM
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Hey, I just got off the phone with the help desk. Here is the answer...
Thank you for contacting the FHA Resource Center. Below is a summary
of your request and our response.
If this issue is not resolved to your satisfaction, you may reopen it
within the next 2 days.
Thank you for allowing us to be of service to you.
Subject
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Can borrower have more than one FHA loan?
Discussion Thread
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Customer (Entered by Jason Ogilbee) - 06/12/2008 01:43 PM
Thank you for contacting the FHA Resource Center. Please see the following response to your inquiry.
For further assistance please contact the FHA Resource Center at hud@custhelp.com or by calling 1-800-225-5342 (1-800-CALL-FHA).
Did you know you can find answers to most all of your questions at http://faq.fha.gov?
Can a person have more than one FHA loan?
Answer
To prevent circumvention of the restrictions on FHA-insured mortgages to investors, we generally will not insure more than one mortgage for any borrower. Any person individually or jointly owning a home covered by a mortgage insured by FHA in which ownership is maintained may not purchase another principal residence with FHA mortgage insurance except under the situations described below. Properties previously acquired as investment properties are not subject to these restrictions.
We will not insure a mortgage if we conclude that the transaction was designed to use FHA mortgage insurance as a vehicle for obtaining investment properties, even if the property to be encumbered will be the only one owned using FHA mortgage insurance. We do not object to homebuyers using FHA mortgage insurance more than once if compatible with the homebuyer's needs and resources as follows:
A. Relocations. If the borrower is relocating and re-establishing residency in another area not within reasonable commuting distance from the current principal residence, the borrower may obtain another mortgage using FHA insured financing and is not required to sell the existing property covered by a FHA-insured mortgage. The relocation need not be employer mandated to qualify for this exception. Further, if the borrower returns to an area where he or she owns a property with an FHA-insured mortgage, it is not required that the borrower re-establish primary residency in that property in order to be eligible for another FHA insured mortgage.
B. Increase in Family Size. The borrower may be permitted to obtain another home with an FHA-insured mortgage if the number of legal dependents increases to the point that the present house no longer meets the family's needs. The borrower must provide satisfactory evidence of the increase in dependents and the property's failure to meet the family's needs. The borrower also must pay down the outstanding FHA mortgage (secondary liens do not need to be paid off or paid down) on the present property to a 75 percent or lower loan-to-value (LTV) ratio. A current residential appraisal must be used to determine LTV compliance. Tax assessments, market analyses by real estate brokers, etc., are not acceptable as proof of LTV compliance.
C. Vacating a Jointly Owned Property. If the borrower is vacating a residence that will remain occupied by a co-borrower, the borrower is permitted to obtain another FHA-insured mortgage. Acceptable situations include instances of divorce, after which the vacating ex-spouse will purchase a new home, or one of the co-borrowers will vacate the existing property.
D. Non-Occupying Co-Borrower. A non-occupying co-borrower on property being purchased with an FHA-insured mortgage as a principal residence by other family members may have a joint interest in that property as well as in a principal residence of their own with a FHA-insured mortgage. (See HUD Handbook 4155.1 REV-5, paragraph 1-8 B for additional information).
Under no circumstances may investors use the exceptions described above to circumvent FHA's ban on loans to private investors and acquire rental properties through purportedly purchasing "principal residences." Considerations in determining the eligibility of a borrower for one of these exceptions are the length of time the previous property was owned by the borrower and the circumstances that compel the borrower to purchase another residence with an FHA-insured mortgage.
In all other cases, the purchasing borrower either must pay off the FHA-insured mortgage on the previous residence or terminate ownership of that property before acquiring another FHA-insured mortgage.
DISCLAIMER: All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.
Additional Information
Reference: Handbook 4155.1, Section 1-2A-D
[---001:004121:27642---]
DISCLAIMER: All policy information contained in this electronic mail is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.
SO IT LOOKS LIKE ITS NOT GONNA HAPPEN FOR THIS GUY... |
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BB
989 Posts |
Posted - 06/12/2008 : 11:09:39 AM
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quote:
Originally posted by Banker0679
I was always taught that you can only use your eligibility 'one home at a time'
quote:
Originally posted by BB
quote:
Originally posted by Banker0679
VA not FHA
quote:
Originally posted by mganovsky
My undrestanding is that you can only have one FHA loan at a time
You can have more than one VA loan at a time if you have enough eligibility.
This is from the VA Handbook section on eligibility.
If, however, the veteran previously used entitlement which has not been restored, available entitlement is reduced by the amount used on the prior loan(s). |
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mortgagewithme
193 Posts |
Posted - 06/12/2008 : 11:30:27 AM
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quote:
Originally posted by Broker4U
Hey, I just got off the phone with the help desk. Here is the answer...
C. Vacating a Jointly Owned Property. If the borrower is vacating a residence that will remain occupied by a co-borrower, the borrower is permitted to obtain another FHA-insured mortgage. Acceptable situations include instances of divorce, after which the vacating ex-spouse will purchase a new home, or one of the co-borrowers will vacate the existing property.
SO IT LOOKS LIKE ITS NOT GONNA HAPPEN FOR THIS GUY...
Won't item C apply in your situation? I would put the file together with an LOX and submit to your uw for a pre-approval. Sounds like you may have a shot, just don't get the borrowers hopes high |
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Broker4U
324 Posts |
Posted - 06/12/2008 : 11:32:48 AM
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But the Borrower is not vacating the jointly owned property. Its the Co-BWR who wants out....
quote:
Originally posted by mortgagewithme
quote:
Originally posted by Broker4U
Hey, I just got off the phone with the help desk. Here is the answer...
C. Vacating a Jointly Owned Property. If the borrower is vacating a residence that will remain occupied by a co-borrower, the borrower is permitted to obtain another FHA-insured mortgage. Acceptable situations include instances of divorce, after which the vacating ex-spouse will purchase a new home, or one of the co-borrowers will vacate the existing property.
SO IT LOOKS LIKE ITS NOT GONNA HAPPEN FOR THIS GUY...
Won't item C apply in your situation? I would put the file together with an LOX and submit to your uw for a pre-approval. Sounds like you may have a shot, just don't get the borrowers hopes high
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jengel
315 Posts |
Posted - 06/12/2008 : 11:35:43 AM
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It would appear your boss at the bank is in fact an idiot, and should have taken the time to look this up in the 4155 for clarification...a great resource by the way, and a time saver in lieu of posting on this site...glad to see you have your answer, good luck! |
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mortgagewithme
193 Posts |
Posted - 06/12/2008 : 11:36:09 AM
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| I understand, but not sure if that would matter as they are both equally obligated. Since it is going through your bank, do you have an underwriter you have some rapport with that you might be able to run it by? |
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Broker4U
324 Posts |
Posted - 06/12/2008 : 11:55:52 AM
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I think your right... But the BWR leaving the current residence.. is allowed to purchase a new FHA?? I need some coffee or something... My Brain is tripping over itself...
quote:
Originally posted by Banker0679
or one of the co-borrowers will vacate the existing property.
which means that when there are more than 1 borrower then they're considered co-borrowers.
I think you're confusing a co-signer with a co-borrower
quote:
Originally posted by Broker4U
But the Borrower is not vacating the jointly owned property. Its the Co-BWR who wants out....
quote:
Originally posted by mortgagewithme
quote:
Originally posted by Broker4U
Hey, I just got off the phone with the help desk. Here is the answer...
C. Vacating a Jointly Owned Property. If the borrower is vacating a residence that will remain occupied by a co-borrower, the borrower is permitted to obtain another FHA-insured mortgage. Acceptable situations include instances of divorce, after which the vacating ex-spouse will purchase a new home, or one of the co-borrowers will vacate the existing property.
SO IT LOOKS LIKE ITS NOT GONNA HAPPEN FOR THIS GUY...
Won't item C apply in your situation? I would put the file together with an LOX and submit to your uw for a pre-approval. Sounds like you may have a shot, just don't get the borrowers hopes high
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dkendall1979
10298 Posts |
Posted - 06/12/2008 : 11:57:42 AM
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Dude...
your BORROWER is vacating the property. Get it?
quote:
Originally posted by Broker4U
But the Borrower is not vacating the jointly owned property. Its the Co-BWR who wants out....
quote:
Originally posted by mortgagewithme
quote:
Originally posted by Broker4U
Hey, I just got off the phone with the help desk. Here is the answer...
C. Vacating a Jointly Owned Property. If the borrower is vacating a residence that will remain occupied by a co-borrower, the borrower is permitted to obtain another FHA-insured mortgage. Acceptable situations include instances of divorce, after which the vacating ex-spouse will purchase a new home, or one of the co-borrowers will vacate the existing property.
SO IT LOOKS LIKE ITS NOT GONNA HAPPEN FOR THIS GUY...
Won't item C apply in your situation? I would put the file together with an LOX and submit to your uw for a pre-approval. Sounds like you may have a shot, just don't get the borrowers hopes high
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vburek
522 Posts |
Posted - 06/12/2008 : 12:00:37 PM
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| In this instance, does the son who is buying the next home have to qualify based on both mortgages? |
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dkendall1979
10298 Posts |
Posted - 06/12/2008 : 12:01:56 PM
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No
quote:
Originally posted by vburek
In this instance, does the son who is buying the next home have to qualify based on both mortgages?
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Broker4U
324 Posts |
Posted - 06/12/2008 : 12:07:49 PM
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Sweet...
My brain is just not connecting today... But with all this information, It is definatly a case to bring to the UW. My boss has a great rapport with her, I'll get him to talk to her about the situation and bring up these key points.
quote:
Originally posted by dkendall1979
Dude...
your BORROWER is vacating the property. Get it?
quote:
Originally posted by Broker4U
But the Borrower is not vacating the jointly owned property. Its the Co-BWR who wants out....
quote:
Originally posted by mortgagewithme
quote:
Originally posted by Broker4U
Hey, I just got off the phone with the help desk. Here is the answer...
C. Vacating a Jointly Owned Property. If the borrower is vacating a residence that will remain occupied by a co-borrower, the borrower is permitted to obtain another FHA-insured mortgage. Acceptable situations include instances of divorce, after which the vacating ex-spouse will purchase a new home, or one of the co-borrowers will vacate the existing property.
SO IT LOOKS LIKE ITS NOT GONNA HAPPEN FOR THIS GUY...
Won't item C apply in your situation? I would put the file together with an LOX and submit to your uw for a pre-approval. Sounds like you may have a shot, just don't get the borrowers hopes high
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socalusa
267 Posts |
Posted - 06/12/2008 : 12:09:33 PM
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The DTI would increase, as the old home's PITI less (1/2 of economical rent that is due from the douche dad, would be considerd long term obligation for the son. it would increase the long term obligations by that much, like another car payment.
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Broker4U
324 Posts |
Posted - 06/12/2008 : 12:44:25 PM
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quote:
Originally posted by socalusa
The DTI would increase, as the old home's PITI less (1/2 of economical rent that is due from the douche dad, would be considerd long term obligation for the son. it would increase the long term obligations by that much, like another car payment.
HAHAHAHA...  "douche dad"... Thats exactly it. I think I have a fighting chance here... |
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mkulikoff
32 Posts |
Posted - 06/12/2008 : 2:49:58 PM
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I just closed a loan w/fha same exact scenario. I had to prove why the son was moving out & that his dad made the payments. (dad was heavy smoker & son found out girlfriend having baby & so they refused to raise baby in that environment) I documented the hell out of that file, I even had a doctors note indicating the due date of the baby to back up my story.
it was a tough deal, but it funded last month.
quote:
Originally posted by Broker4U
Father and Son own a home... Son is Co-Bowwer... Son wants to buy another home to move out, but Father is dragging his feet on refinancing the home to remove the son. The current loan is FHA. Can the Son still get an FHA as his primary Residency if he can prove that the Dad makes the payments on the other property? My guess is No....
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mortgagegirl1010
203 Posts |
Posted - 06/12/2008 : 7:38:58 PM
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From the handbook:
Vacating a Jointly Owned Property.
If the borrower is vacating a residence that will remain occupied by a co-borrower, the borrower is permitted to obtain another FHA-insured mortgage. Acceptable situations include instances of divorce, after which the vacating ex-spouse will purchase a new home, or one of the co-borrowers will vacate the existing property.
D. Non-Occupying Co-Borrower.
A non-occupying co-borrower on property being purchased with an FHA-insured mortgage as a principal residence by other family members may have a joint interest in that property as well as in a principal residence of their own with a FHA-insured mortgage. (See paragraph 1-8 B for additional information
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