October 26, 2011
A frequently asked question about FHA home loans concerns the length of time it takes to learn whether the loan application has been approved or not. This is a part of the FHA loan process that can be stressful for some borrowers, especially those who have never applied before and don’t know what to expect.
The simple answer is that FHA requirements include a rule that the lender must take action on your application and let you know about that action no later than 30 days after the application has been completed and turned in. FHA rules emphasize the application must be complete for this rule to take effect.
But what does that mean?
Some borrowers mistakenly think submitting partial information on credit data, employment history or other information might protect them from having an application rejected due to poor credit or past financial mistakes. “What the lender doesn’t know won’t hurt…”
But this is not true–the lender cannot process a credit application that is not completely filled out, and the FHA’s “30 day rule” does not apply in cases where incomplete forms have been given back to the lender. Any gaps in the application data could cause serious delays in the processing of an FHA loan application.
According to the FHA official site, “Your application will not be considered complete, and the 30 day period will not begin, until you provide to your lender or mortgage broker all of the material and information requested.”
Borrowers concerned about past credit issues–especially where defaults, bankruptcy, evictions or other issues are concerned–should contact the FHA for advice and housing counseling before filling out an FHA loan application. Borrowers who take a proactive approach to these issues may find ways of resolving such concerns and improving their chances at an FHA mortgage.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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