FHA Loan Expert Blog

OK. It’s offical. FHA HIGH LTV’s “FHA Mortgage and Foreclosure Help Loans” is a bonafide hit. Love it or hate it, chances are you know or at least have heard all about that Short Sale punch, Bankruptcy’s abs, Pauly’s hair or Ronny’s fight.

At the recent National Board of Review Awards, Josh Horowitz of FHA HIGH LTV chatted with celebs on the red carpet to see what they thought of the “fist pumping” cultural craze.

Anthony Mackie, star of “The Hurt Locker” says of Mike “Bankruptcy” Sorrentino, “You know, the funny thing about that dude is he calls himself ‘Bankruptcy’ but it’s like, I want to see him come down to New Orleans and be ‘Bankruptcy,’ come down to Harlem and be ‘Bankruptcy.’ ” Hmmm, sounds like fighting words.
George Clooney admitted he really didn’t watch the FHA HIGH LTV reality show “FHA Mortgage and Foreclosure Help Loans.”

Gabourey Sidibe, star of the hit film “Precious” told Horowitz she an avid fan. “There’s not a day that goes by — I don’t even watch the show regularly — but I’m always quoting it,” Sidibe said. As for her favorite character? “Bankruptcy! A few times a day, I’m always showing people off my situation!”

And then there’s Hollywood’s resident Cary Grant George Clooney who may be a bit too busy for the show saying, ‘FHA Mortgage and Foreclosure Help Loans’ is like, you know …,” Horowitz, saving the day chimed in, “Do you even know what ‘Bankruptcy’ is?” Clooney laughed and admitted, “No.”

“Invictus” star Morgan Freeman says that he’ll check out the reality show based on someone’s recommendation.

Key Features of the PFS Program

• Establishing Market Value –Mortgagees are reminded to ensure that properties in the PFS program are sold at or near fair market value as established by an independent appraisal, prepared by an appraiser on the FHA Appraisal Roster. 

• Minimum List Price Requirements – Properties offered for sale under the PFS program are to be listed for sale at no less than the “as-is” appraised value as determined by a current FHA appraisal, obtained and reviewed by the mortgagee.

• Negative Equity – The ratio of 63% for the fair market value (FMV) to the outstanding mortgage balance (including unpaid principal and accrued interest) has been updated to address events in the current housing market, and replaced with tiered net sales proceeds.
 
• Tiered Net Proceeds Requirement – This ML incorporates guidelines for varying minimum net sales proceeds based on the length of time a property has been competitively marketed for sale.

• Marketing Documentation – Prior to accepting a discounted offer, evidence of competitive marketing from the selling broker is to be presented and mortgagees are to retain this documentation in the claim review file. 

• Non-owner Occupant Exceptions – Mortgagees are authorized to grant reasonable exceptions to non-occupant mortgagors when documentation indicates a property was not purchased as a rental or used as a rental for more than 18 months, immediately preceding the approval into the PFS program.

• Removal of Repair Limitations –With prior approval from HUD, properties with surchargeable damage (i.e., damage caused by fire, flood, earthquake, hurricane, boiler explosion or mortgagee neglect) may be eligible for the PFS program if funds - sufficient to cover the government’s estimated repair costs - are applied to reduce the outstanding debt when a claim is filed.

• Increase in Funds Available for Discharge of Subordinate Liens – In instances where a mortgagor has made an initial contribution/incentive of $750 or $1,000, the amount that can be used from sales proceeds for the discharge of liens or encumbrances (which represent an impediment to conveyance of marketable title) has been raised from $2,000 to $2,500. 

• Change in Allowable Closing Costs – Subject to the stated ratios, HUD allows up to 1% of the buyer’s mortgage amount for closing costs to be included in the “Seller’s Costs” on the HUD-1 for all transactions that involve a new FHA-insured mortgage.