- If the credit report on a loan with RHS approval will expire prior to loan closing, a new credit report outside of GUS can be pulled. If the new report shows no changes to credit, then the loan does not need to be resubmitted to RHS for re-approval.
- RHS considers a loan as qualifying for conventional credit if all of the following are true
- Borrower has eligible assets to meet a 20% down payment AND reasonable closing costs; AND
- The loan meets all current FNMA guidelines
- Assets should be calculated using the lesser of a two month average balance or the current bank statement/recent VOD.
- Debts omitted in GUS now require that reason for omission be listed in the “Notes” section.
- Military applicants are no longer required to provide evidence of pending discharge.
- The following are now considered part of the Household income when determining income eligibility
- Documented pay raise/cost of living raise to occur on or prior to closing
- Income from spouse living apart less than 3 months, unless divorce or legal separation proceedings have been commenced
- Continuance is automatically assumed on Social Security income unless the benefit letter specifically states an expiration date.
- Payments for the care of foster children or adults cannot be used as income.
- Authorized User accounts can be used to meet tradeline requirements if 12 months payment can be documented by the borrower.
- 30 day accounts paid each month do not have to be included in the DTI.
- Previous mortgage liabilities disposed of without release of liability (i.e. divorce, assumed, etc.) can be excluded from the debt calculation if the transaction can be fully documented along with 12 months of mortgage payments by the remaining party
- Judgments accounts may be excluded from the debt calculation if less than 10 months remain on the repayment plan.
- Charge-off accounts should not be included as a liability or a debt.
- Debts incurring a significant impact on repayment are now defined as being 5% or more of the gross monthly income.
- USDA does not have to be added to the appraisal as an intended user.
- Specific photograph requirements have been added to include
- Front view
- Rear View
- Street scene identifying location and showing neighboring improvements
- Kitchen, main living area, bathrooms, bedrooms
- Any other rooms representing overall condition, recent updates, restoration, remodeling, and renovation
- Basement, attic, and crawl space
- At least a front view of each comparable used in determining the valuation
- Common areas and shared amenities (Condos only)
- Additional safety measures are required for properties in a flood zone which also use private septic & water systems.
Use the greater of one percent (1%) of the outstanding loan balance or the verified fixed payment as reflected on the credit report.
Income Based Repayment (IBR) plans, graduated plans, adjustable rates, interest only and deferred plans are examples of repayment plans that are subject to change. These types of repayment plans are unacceptable to represent a long term fixed payment plan.