All FHA Lenders use Total Scorecard as their Automated Underwriting System, and have to follow the same Underwriting Guidelines. You should not need to shop them for leniency.
For this particular Borrower, it’s going to depend on the overall credit picture and the reason for the default. FHA is really great at accepting strong explanations for isolated lates, especially if you can document extenuating circumstances.
Don’t forget FHA Secure! If the lates were due to the rate changing, and your borrower no longer is able to afford their home, that may be a great answer to get your borrower financed.
All FHA Lenders have the same guidelines. You can find a HUD approved FHASecure lender here.
Eligibility Highlights of the FHASecure Initiative:
The mortgagor’s payment history on the non-FHA ARM must show that, prior to the reset of the mortgage, the mortgagor was current in making the monthly mortgage payments, i.e., the homeowner’s mortgage payment history during the 6 months prior to the reset showed no instances of making mortgage payments outside the month due.
If there is sufficient equity in the home FHA will insure mortgages that include missed mortgage payments.
Mortgagees must determine, as part of the underwriting process, that the reset of the non-FHA ARM monthly payments caused the mortgagor’s inability to make the monthly payments and that the mortgagor has sufficient income and resources to make the monthly payments under the new FHA-insured refinancing mortgage.