“Interpretation of New FHA Guidelines Create Lots of Problems Already”

“Interpretation of New FHA Guidelines Create Lots of Problems Already”



To say that FHA wants to restrict lending would be an understatement. So, all of the BS about guidelines being loosened up is just that. Here is an example of someone that can now NOT buy a home.


My client is a teacher who is a single parent with $201,000 in student loan debt. She is currently involved with a Federal program that the loan is paid back based on a percentage of her income and each year the income is reviewed and a new payment is assessed and that will be a payment for that year. This renewal happens only once a year and if not renewed the payment goes to a much higher level.


The way that it was explained to me is that after the 20 years, the remaining debt goes away. This client wants to buy a $100,000 house, with 3.5% down and will have a mortgage payment of $874. Currently her rental payment is $200 higher so the purchase would be a good choice for this client.


Here is the problem, even though her payment is $156 it is due to expire in July of 2016. Under the new guideline I need to use 2% of the debt, which means a payment of over $4000 per month even though her current payment is $156 and the following July she will still have a payment under $200 based on a modest expected increase in income.


I have shared this problem with a dozen lenders and each has said I have to use $4,000 not the $156. Whoever created these guidelines does not have a clue about reality.


Two lenders have said they will see if they can get an exception, if they get documentation that this Federal program will continue. I am not sure if it is possible.


Do you think this is fair?


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Joe Petrowsky, NMLS #6869

Right Trac Financial Group, Inc. NMLS #2709

110 Main St.

Manchester, Ct. 06042

Office: 860 647-7701 x116

Fax: 860 647-8940

Cell: 860 836-9294

Email: joe@righttracfg.com



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Joe Petrowsky does not guarantee nor is in any way responsible for the accuracy of the information provided herein, and provides said information without warranties of any kind, either expressed or implied.

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Comment balloon 28 commentsJoe Petrowsky • September 25 2015 10:47AM


No, of course it's not fair.  It's not logical either.  I hope they make an exception.

Posted by Debbie Gartner, The Flooring Girl & Blog Stylist -Dynamo Marketers (The Flooring Girl) almost 5 years ago

 These are the kind of exceptions we take to in house lending programs and credit unions who look as borrowers as individuals...what a concept !

Posted by Sally K. & David L. Hanson, WI Real Estate Agents - Luxury - Divorce (EXP Realty 414-525-0563) almost 5 years ago

Good morning Joe.  As with so many federal programs their intentions are good but the result can be devastating 

Posted by James Dray, Exceptional Agents, Outstanding Results (Fathom Realty) almost 5 years ago

Hi Joe.  Obama wants the federal government out of the mortgage business.  You juts gave us another example how they are doing that.

Posted by Conrad Allen, Webster, Ma, Realtor (Re/Max Professional Associates) almost 5 years ago

If I were the lender, I think I would do the same thing.  There is no guarantee that this federal program will continue to be renewed.  I feel bad for the customer, but she does have a $200K debt.

Posted by Gabe Sanders, Stuart Florida Real Estate (Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales) almost 5 years ago

Good morning, Joe Petrowsky that's so unfair....totally unjust....there will never be an exception unless someone has some very hefty "juice" .....

Posted by Barbara Todaro, Marketing Agent for The Todaro Team (RE/MAX Executive Realty ) almost 5 years ago

Joe: It is ridiculous and completely unfair. I would be shocked to see many exceptions get approved.

Posted by Anita Clark, Realtor - Homes for Sale in Warner Robins GA (Coldwell Banker Access Realty ~ 478.960.8055) almost 5 years ago

 Good Sunday morning Joe. I think that this is totally ridiculous and completely unfair.

Posted by TeamCHI - Complete Home Inspections, Inc., Home Inspectons - Nashville, TN area - 615.661.029 (Complete Home Inspections, Inc.) almost 5 years ago

Good morning Joe, I agree with the others. What a foolish thing. What were they thinking... or not thinking... 

Posted by Andrea Swiedler, Realtor, Southern Litchfield County CT (Berkshire Hathaway HomeServices New England Properties) almost 5 years ago

No I don't think that is fair at all. If the program continues then some formula tied to the program should be used. I hope they will modify this.

Posted by Debbie Reynolds, Your Dedicated Clarksville TN Real Estate Agent (Platinum Properties) almost 5 years ago

Joe, sounds like a regulation that a certain "Barney" had something to do with since it makes no sense! Enjoy your day and good luck with the bureaucracy!

Posted by Wayne Martin, Real Estate Broker - Retired (Wayne M Martin) almost 5 years ago

Good morning Joe,

Student loans are a pain the arse and there should be better means to assist some of these people instead of lining the pockets of D.C.

Make yourself a great day.

Posted by Raymond E. Camp, Licensed Real Estate Salesperson Greater Rochester (Howard Hanna Real Estate Services) almost 5 years ago

Good morning Joe Petrowsky,

Of course it's not fair! Student loans are always an issue but under this program using some common sense would be logical. But remember who came up with these new guidelines..they are not intended to help the consumer only cause aggravation!

Posted by Dorie Dillard CRS GRI ABR, Serving Buyers & Sellers in NW Austin Real Estate (Coldwell Banker United Realtors® ~ 512.750.6899) almost 5 years ago

Joe, these new FHA guidelines do sound like they will cause a few problems until someone clarifies them better.

Posted by Joan Cox, Denver Real Estate - Selling One Home at a Time (House to Home, Inc. - Denver Real Estate - 720-231-6373) almost 5 years ago

I agree with everyone to. I think Debbie Reynolds is right. The program should be modified to allow a home loan.

Posted by Sussie Sutton, David Tracy Real Estate for Buyers & Sellers (David Tracy Real Estate) almost 5 years ago


It definitely is not fair...and it is evident that this law was written by near sighted people who did not think it through, and voted in by the same near sighted people.  Hopefully, it will change.  A

Posted by Ron and Alexandra Seigel, Luxury Real Estate Branding, Marketing & Strategy (Napa Consultants) almost 5 years ago

As Debbie Gartner states "not fair nor logical"...yet this is exactly what we expect from our government.  Out of control.  If there is anyone that will be successful in getting her the loan it will be Joe Petrowsky of Manchester Ct.

Make it a great day Joe.


Posted by Mark Don McInnes, Sandpoint, North Idaho Real Estate - 208-255.6227 almost 5 years ago

More confusion!  This makes no sense.  The object of new guidelines is to make it better, not worse.

Posted by 1~Judi Barrett, BS Ed, Integrity Real Estate Services -IDABEL OK (Integrity Real Estate Services 118 SE AVE N, Idabel, OK 74745) almost 5 years ago

Joe- unfortunately, common sense seems to be missing in many of the guidelines and decisions being made. 

Posted by Kathy Streib, Home Stager - Palm Beach County,FL -561-914-6224 (Room Service Home Staging) almost 5 years ago


Thanks for sharing the information on the new FHA guidelines.

Good luck and success

Posted by Lou Ludwig, Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC (Ludwig & Associates) almost 5 years ago

Hello Joe Petrowsky 

Government and fair is like saying Government and common sense...

Posted by Lisa Von Domek, ....Experience Isn't Expensive.... It's Priceless! (Lisa Von Domek Team) almost 5 years ago

Joe the way I understand it is the problem is because her payment is income based therefore it is a variable payment.  It it was fixed regardless of income then the actual payment could be used.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages) almost 5 years ago

Joe this is just one example of many changes that are detrimental to the consumer. its definitely going to be even tougher

Posted by David Shamansky, Creative, Aggressive & 560 FICO - OK, Colorado Mtg (US Mortgages - David Shamansky) almost 5 years ago

Joe my blood boils when I read posts like this... it reminds me of the Joke... why does a person spend $20million to get a $400k Job???Endre

Posted by Endre Barath, Jr., Realtor - Los Angeles Home Sales 310.486.1002 (Berkshire Hathaway HomeServices) almost 5 years ago

Good morning Joe - it can be complicated. Thank you for your clear explanations!

Posted by Wayne and Jean Marie Zuhl, The Last Names You'll Ever Need in Real Estate (Samsel & Associates) almost 5 years ago

Joe... not only is this not fair, it's completely stupid and illogical! And to some degree it's scary!

Posted by Nina Hollander, Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor (Coldwell Banker Realty) almost 5 years ago

This is not fair and changes need to be made. Thanks for sharing this story.

Posted by Roy Kelley (Realty Group Referrals) almost 5 years ago

Joe - I wish we could have a happy mediam but when the government is here to help us this is what happens.

Posted by Grant Schneider, Your Coach Helping You Create Successful Outcomes (Performance Development Strategies) almost 5 years ago