Profile picture for PamKoraly

FHA loan on a ranch. 2 buyers (1 occupant) ok credit, got the $ for dwnpmnt lender stalling.HELP

The property is already occupied by the buyers under a lease option contract.
one owner is overseas on 1 to 2 year assignment with civilian contractor.  Permanent employee just out of the country on assignment. His family lives in the ranch (wife,stepson and his own son on a partime basis)  Co- borrower lives in the house too, long time friend and roomate. Wife is not on loan.  The lender is saying the co-borrower needs to be a blood relative and the main borrower needs to be living in the house 51% of the year.   Both credit scores are ok and the money for the downpayment is in the bank waiting for a closing.  How is it possible that the under writer can stone wall this deal.  It is time sensitive and the ranch could be sold out from under the buyers!  Thank you
  • March 18 2011 - Ramona
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Answers (4)

You could also likely be having a problem proving that the income for the borrower may not continue for 3 yrs.

I have seen this with civilian contractors overseas.
  • March 19 2011
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Profile picture for wetdawgs
FHA loans are indeed for the primary residence of the borrowers.  Perhaps the wife needs to be on the loan.

In addition, I wasn't aware that one could get FHA loans on agricultural land larger than 10 acres.  Perhaps that is contributing to the delay.

Perhaps you need to look at conventional loans, not FHA.

  • March 19 2011
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By owner I assume you mean prospective buyer.

It sounds like he is the non-occupying c/b. Wife, etc aren't relevant as they aren't on the loan.

the friend living in the home is the occupying borrower.

The blood relationship thing only applies to maximum financing. Put 25% down and you'll be fine.

btw: blood relationship INCLUDES; documented, long standing and substantial  relationship not arising out of the transaction. (i.e long time friend)  
  • March 19 2011
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Sorry, it doesn't sound like your Loan Officer packaged your loan properly.  They should have provided a good cover letter explaining the arrangement to the underwriter.  I think the underwriter probably said that a non-occupying co-borrower needs to be a relative.  In your case, they are an occupying co-borrower.  You may want to provide them with some proof of residency of the permanent employee, like any utility bills in his name for the subject property.  I assume his bank statements, pay stubs, tax returns, etc... all indicate the subject property.  That information may help the underwriter decide in your favor.  I hope this bit helps.  If you need anything further, then please don't hesitate to ask.  I hope it works out.
  • March 19 2011
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