A big change took effect on March 15th for FHA loans to lower the risks of future large defaults. This change will affect lower credit applicants whose Debt To Income are in the range of 50 to 56%. Most of these individuals will be issued a ‘Refer Eligible’ instead of the ‘Approve Eligible’ rating. To you and your client, this simply means manual processing of the files and with manual processing comes longer underwriting time frames.
If you work with a lender that has experience with referred files, This should not impact you or your client. We are always available to sit down with you or your client to review their case. Book an appointment for more information here.