Archive for October 2014

2nd Homes and HUD Condo Approval Requirements

October 12, 2014

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We have received a couple of request for assistance in procuring FHA approval for HOAs that have large 2nd home populations. The HOAs are counting these 2nd homes as owner occupied as they were not rented or leased and only the owner occupied them. Let’s address this question.

Regarding this issue in an email to us HUD says:

“At this time Second Homes do not qualify as owner occupied units.”

As per 24 CFR 203.18 (f) a Secondary residence means a dwelling:

(i) Where the mortgagor (owner) maintains or will maintain a part-time place of abode and typically spend (or will spend) less than a majority (Less that 50.1%) of the calendar year.

(ii) Which is not a vacation home

(iii) No applicable to FHA Condo Approval

Basically HUD maintains that if a homeowner is not living in the condo for at least 50.1% of the year that unit cannot be counted as owner occupied  when calculating the over 50% owner occupied requirement.

I hope this clears up the 2nd Home or Vacation Home questions. If you have any FHA Approval questions feel free to contact us at (800) 833 0409 Ext 1.

The FHA Condos Approval Company, Inc.

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CFPB Director Says Bureau Will ‘Vigorously Enforce’ Mortgage Servicing Rules

October 1, 2014

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This is a baby step in the right direction. The true test will be when they take on one if the major servicers that was  found in violation. Until the feds start pressing criminal charges against the heads of the offending servicer nothing will really change. These executives will continue to make a boatload of money and pay for their wrong doings with the stockholders money.

The FHA Condos Approval Company, Inc.

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For the first time since the new mortgage servicing rules went into effect in January 2014, the Consumer Financial Protection Bureau (CFPB) enforced the rules, handing down a $37.5 million fine on Monday to Michigan-based bank Flagstar for illegally blocking foreclosure prevention.

CFPB Director Richard Cordray said in press call on Monday that his Bureau will not tolerate violations of the new mortgage servicing rules.

“These new regulations establish specific rules of the road for handling loss mitigation applications,” Cordray said. “Since we first announced these rules almost two years ago, we have made clear that we expect full compliance to clean up the problems that had been pervasive in this industry and caused so many people to lose their homes. Consumers must not be hurt by illegal servicing any more. When mortgage servicers fail to treat people fairly, we will vigorously enforce the law.”

Cordray said it is vital that mortgage servicers follow the law because of the “central role” they play in borrowers’ lives.

“(Servicers) are the link between a mortgage borrower and a mortgage owner,” Cordray said. “They collect and apply payments, work out modifications to the loan terms, and handle the difficult process of foreclosure. Importantly, consumers cannot take their business elsewhere. Instead, they are stuck with their mortgage servicer, whether they are treated well or poorly.”

To read the complete article – please use the link below.

‘Vigorously Enforce’ Mortgage Servicing Rules