On August 15, 2013 HUD released Mortgagee Letter 2013-26 which outlines new guidelines for considering a borrower for a new FHA home loan after someone has experienced short sale, foreclosure, deed-in-lieu or bankruptcy.  HUD has recognized that many borrowers had extenuating circumstances during the economic down turn that resulted in them facing hardships.   These new underwriting guidelines are in effect as of August 15, 2013.

To that end, FHA is allowing for the consideration of borrowers who have experienced an “economic event” AND can document the following:

1.  certain credit impairments were the result of a Loss of Employment or significant loss of Household Income beyond the borrower’s control;

2.  the borrower has demonstrated fully recovery from the event, AND;

3.  the borrower has completed housing counseling.

If you have experienced one of these hardships and have gotten back on track you will want to contact a mortgage lender to see if you qualify.