FHA Loan Delay Opps to Private Money Lenders

[Corey Dutton]

Private money, non-bank lenders may have a tremendous opportunity to fund FHA loans in limbo this year. And you may be asking, what will happen to all of the FHA loans with the government shutdown? This looming question eats away at borrowers who are still waiting for FHA to give them a closing date. These anxious borrowers may be waiting a long time, days, weeks, maybe even months for refinances. Loans still waiting for a firm commitment from the FHA are likely to keep on waiting for awhile, sources say.

This is good news for private money, non-bank lenders, also called bridge lenders, or commercial "hard money lenders." Particularly for new purchases that have already been waiting months for FHA approval, the frustration of borrowers is at a boiling point. Many of them have already sought out alternative sources of financing.

But for properties located in rural areas, FHA may be the only option as some markets are avoided even by private money lenders. For those borrowers who are seeking FHA refinances, sources say these deals are going to the back of the line and could wait months for a commitment from FHA. Depending on the timeline for a refinance, a private money lender may be the only option for those in wait for FHA financing this year. Here's the source of the article:http://nreionline.com/multifamily/fha-deals-delayed-shutdown#comment-2751