Assurity Financial Services Announces FHA Secure Mortgage Product

Assurity Financial Services FHA Secure Announcement

Effective today, Assurity Financial Services officially offers the new FHA Secure Mortgage product to borrowers who qualify.  The FHA Secure product allows homeowners to refinance various types of Adjustable Rate Mortgages that have recently reset.  Some of the eligibility highlights include:

  1. The mortgage being refinanced must be a non-FHA ARM that has reset.
  2. The borrower’s payment history on the non-FHA ARM must show that prior to the reset, the borrower was current in making monthly mortgage payments.
  3. Under certain conditions, if there is sufficient equity in the home, FHA will insure mortgages that include missed mortgage payments.  FHA will permit first liens, purchase money seconds, closing costs, pre-paids, discount points, prepayment penalties and late charges.  The amount of the FHA Secure Mortgage may not exceed either the geographical maximum mortgage limits or the standard maximum LTV ratios set by FHA.
  4. Lender must document that the reset of the non-FHA ARM monthly payments caused the borrower’s inability to make the monthly payments and that the borrower has sufficient income and resources to make the monthly payments under the new FHA insured refinance.
  5. FHA encourages the use of Total Mortgage Scorecard to obtain risk classification.  If TOTAL renders an “accept/approve”, the underwriter will not need to perform review of the borrower’s credit history and capacity to repay.  In the more likely event that the risk class is a “refer”, the underwriter must determine borrower has the capacity to pay, and ratios should remain 31/43.  Compensating factors are to be provided to underwriter when ratios are exceeded.
  6. The FHA Secure initiative is for refinancing borrowers that were harmed by non-FHA ARMs that have recently reset.  It is not to be used to solicit homeowners to cease making timely mortgage payments.   FHA reserves the right to reject applications where it appears that a loan officer or other mortgage employee suggested that the homeowners could stop making their payments; refinance into an FHA insured mortgage and keep the amount of payments not made on time.

Assurity Financial Services also notes that this program is temporary and requires applications be signed no later than December 31, 2008.

This entry was posted on Tuesday, November 20th, 2007 at 9:47 am and is filed under Latest FHASecure Related Information. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.