Fha Loans And Tax Liens New Jersey

Recent Changes in Housing Regulations and how it affects you

Though the granting of easy-to-qualify FHA Loans may indicate how generous the government is, a new announcement made by Carol Galante, assistant Secretary for Housing Federal Housing Commissioner reveals that Uncle Sams largesse has its limits as well. Any tax liens now must be fully satisfied before an FHA home purchase is allowed to close. Otherwise, such loans will not be allowed to be issued by the FHA.

Certain exceptions can apply, though the following must be provided:

1) A fully executed and documented installment arrangement must be evidenced.

2) Timely payments must be shown and documented over the past 12 months (this is generally evaluated on a case-by-case basis). This payment would also be factored in the debt-income ratio, an important underwriting tool mortgage companies use before granting or not granting a mortgage.

3) Tax liens in any community property states subjects the non-borrowing spouse the same requirements that bind the borrowing, lien-holding spouse.

4) All satisfied tax liens on title must be resolved and removed before closing.

5) For cash-out refinances, proceeds from the closing can be used to pay off outstanding tax liens. However, to approve this, the mortgage underwriter must grant an exception on a case-by-case basis. Furthermore, the originating lender must document that the tax lien was paid at closing.

It is no longer possible for an individual or family to take advantage of the lower underwriting requirements and favorable rates of government-issued FHA Loans, and to put off any tax lien responsibilities. Thus, it becomes even more important to get the proper guidance in selecting the right mortgage but getting qualified to close on the mortgage. At Bond Street Loans, we have a wealth of experience, knowledge and integrity to give you the proper guidance in navigating the constantly changing waters of governmental programs and requirements.

For further information about this process and/or for mortgages in general, please call Bond Street Loans at 201 282 5016. We are located at 95 Route 17 South, Suite 302, Paramus, NJ 07652 (next to the Ikea building).

James DiPiazza,

CEO,

Bond Street Loans

BondStreetLoans.com

by: James Di Piazza

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