Comments on: No FHA Mortgages to Buy & Bail

By: Frank Allgood

Frank Allgood — Tue, 14 Jul 2009 22:29:09 +0000

I am dealing with this issue right now and it is disastrous! I have a home that is worth less than the mortgage is on it and have secured a five year lease agreement with deposit covering the monthly mortgage payment. I am under contract to purchase a 270k home and have the 3.5% in cash to put down, plus I am paying closing costs out of pocket. My credit score is 770 and I have never been late or delinquent on any payments for anything. And now FHA is saying that I can’t count the rental income. Come on, how about half! I am frustrated to say the least!

By: Ledeen

Ledeen — Sun, 07 Jun 2009 21:51:05 +0000

Do all the guidlines apply????

My employer wants to transfer me to Virgnia, but I own a home here in California and I cannot sell it (worth less than teh mrotgage)

wanted to buy in VA and lease this one out, so Id meet all the criteria with the exception of the ltv on the existing home,

so basically Ill be stuck RENTING in VA…..

By: Nina

Nina — Wed, 28 Jan 2009 20:58:26 +0000

I also agree with the last writter, my husband and I have been repairing our credit and awaiting for me to finish college to purchase a new house. The current house that we live is very small for the family of four that have two growing boys that have to share a room. It is about 900 sq. Since Sept 2008 we have been working a mortage broker that has been guiding us. Everything was looking fine I finished school and we both made good money and fair credit. Our mortage broker stated that we would get approved for a mortage and we could rent out the current house. Inthis market houses are not selling and besides the house was built but my husband grandfather. So, we needed to keep the house either way. We had everything was set in place and we suppose to apply for a mortage, broker called us and statedthat we can not purchased a house because of the buy and bail thing that is going around. Now, we had no idea or plan for a bail out plan, we had several people wanting to rent our house. Four years of denial of mortages and now we had a very good chance to move and the carpet has been taken from under our feet. I have done everthing that the mortage lender told us to do. Everything little thing they told us to do and now it was for nothing. Instead of repairing Michigan, it is making it harder to own a house. For people that are honest and trying to get ahead they are just getting puched back down. They told that I would have to have 6-12 months worth of payments of the old house in the bank, then I would qualified, but now I have the money saved up,they tell me that I sell will not qualify for a mortage. I do one thing and they change everytime I qualify. I just can not win. I tried putting the new mortage in my name because I am not on the current mortage and have nothing to do with it, it is still part of my income no matter what I still will not qualify unless we sell, which is impossible to do right now since everyone is losing jobs. I am at lose in what I suppose to do. and stick in a house that way too small for our family. We was so exicted to move and now I ahve to tell my kids that we can not and they have to stay in the same room for a while. Depressing…..

By: JM Arias

JM Arias — Wed, 15 Oct 2008 19:36:37 +0000

Sadly this rule is beginning to claim victims. I am one of them. My mother and I share the home that she and my father built and I grew up in. When my dad passed away twelve years ago, I moved back home because she could not afford to live on her own on her minimal salary. Although as a widow(er), you can claim your spouse’s Social Security, you have to wait until you reach the age of 60. My mom was 47 when my dad died. So I became her roommate. The house needed repairs several years back so she tried to refinance. Because of her low income (even though SHE made her payments on time) the bank with whom she had the mortgage refused to refinance the home for a home equity loan for home improvements. Because I wanted to help my mom I reluctantly offered to assume the mortgage so that we could repair and update the house.

Flash forward to 2008, my mom turned 60 last year, currently receives part of my dad’s social security every month, and can afford to assume her mortgage again. Knowing this, I began the process of building my own house back in February. The home mortgage lending climate has changed dramatically since then. This new rule about rental property is extremely unfair. It is assuming that every potential home buyer is going to buy and bail. The mortgage on the home I am building is double the amount of mortgage on my mom’s home is. According to the letter put out by HUD, these “bail and buy” people are buying cheaper homes and bailing on the more expensive property. My mother will continue to live in HER home and will eventually refinance to put it back in her name. In the meantime for the purpose of my new home loan she was going to make the mortgage payments and for formalities sake, lease HER house from me. This new rule, however makes it impossible for me to do this not to mention that my mom’s house had to appraise at 25% higher than the debt and it appraised at 22%, a mere 3% shy. This slight difference makes it impossible for me to qualify. They will not accept buying down the principal for the $3275 appraisal shortfall. Long story short, if my mom can’t get approved to buy back her house, I will lose the home I spent the last eight months building.

How’s that for sour grapes!