NACA Purchase Program - Underwriting guidelines for those with foreclosures

[JimEB]

Hello,

It WAS my understanding that if you had a hardship foreclosure, NACA could get you a loan after two years. After almost 4 months, they are now telling me FIVE years!

What ARE the underwriting guidelines for the NACA Purchase Program as it relates to a Buyer who had a foreclosure and has almost an 800 FICA score now?

Thanks!

[Evan Bedard]

It WAS my understanding that if you had a hardship foreclosure, NACA could get you a loan after two years. After almost 4 months, they are now telling me FIVE years!

What ARE the underwriting guidelines for the NACA Purchase Program as it relates to a Buyer who had a foreclosure and has almost an 800 FICA score now?

I do not believe you will have to wait 5 years before you will be eligible for a new mortgage. But no matter what lender or program you choose, it will be at least 3+ years following a foreclosure before you will qualify for a new home loan regardless of your credit rating.

[JimEB]

I am a VET I am already prequalified for a VA loan. The VA guideline is 2 years. I just did not want to pay the 2.5 percent funding fee.

[Evan Bedard]

I'm very sorry about that I was not aware you are a Vet, you are correct that you should be able to qualify for a new VA loan 2 years after the initial foreclosure was finalized. We have a couple members here who work with NACA so hopefully they can chime in here soon to help you out. I'm personally not too familiar with their purchase program guidelines.

[Cat Damiano]

Hi Jim,


You can also try contacting the NACA supervisor Kevin Winn to see if his office can help answer this question as well, he can be reached here;

NACA supervisor:
Kevin Winn
kwinn@naca.com
1-617-250-6222 ext. 1254

[lwillhite]

Hello JimEB,

Something was clearly miscommunicated regarding the time frame after foreclosure before you can buy again. Two years is correct, and we genrally advise our members to start the process after 12 months so they have plenty of time to complete the process.

Tim Trumble
NACA Online Operations
ttrumble@naca.com

[JimEB]

NACA finally agreed to the two years after foreclosure ONLY because I had a predatory loan. However, they promptly threw up another road block: All my companies MUST show a profit for two years.

I am a real estate agent and my sales are handled via my PLC (Professional LLC). I sell very little real estate… somewhere between zero and two sales a year. At this time, I just keep my license and Realtor status current.

My PLC owns a legacy LLC from a real estate brokerage that I closed during the down turn. The 2011 tax return was the “FINAL” tax return. But, I have NOT shutdown the LLC with the state. It owes me a lot of money and if I later decide to re-task it, it can pay me back that money without me having to pay FICA on it (I think). It is not currently doing any business and has no NEW losses.

NACA has stated that BOTH businesses MUST show positive cash flow for two years in order for me to be "Ready for home ownership". It seems that they do not understand carryover losses and will not offset minor business expenses such as MLS and Realtor dues (losses) from my FULL TIME JOB that has W-2 income. If anyone would like to see the .tif file I received from NACA stating this I will be happy to supply it.

Bottom line NACA does not seem to be Business Person friendly. If you have a corporation or LLC, they must have positive cash flow. That requirement would make a LOT of millionaires “NOT ready for home ownership”!