FHA Will Ignore Covid-Era Employment Lapse
FHA Will Ignore COVID-Era Employment Lapse
By Sept. 5, lenders must update guidelines to make it easier for salaried/hourly workers and self-employed people to qualify for a loan if they lost work during the pandemic. On Thursday, the Federal Housing Administration (FHA) announced new flexibility for lenders when qualifying borrowers for an FHA loan, specifically those applicants who had previous employment gaps or a loss of income due to the COVID-19 pandemic. The new guidance includes provisions for salaried and non-salaried wage earners, and it addresses the needs of people who are employed full-time, self-employed, employed part-time, earn bonus or tip income, and/or earn commission income. Lenders may begin using the new policies immediately but must implement them for FHA case numbers assigned on or after Sept. 5, 2022.