For instance, if you are applying for an FHA loan, that is, a loan backed by the United States government, your lender will access the CAIVRS system to determine your eligibility. If you have a prior default on an FHA loan or other federal debt, such as an SBA loan or a school loan, more than likely you will show up on CAIVRS and may lose your opportunity to obtain the credit you are seeking. As such, it can be very important to know this information and how to deal with a report on CAIVRS.
FHA CAIVRS Exception
Lenders must use CAIVRS to screen all borrowers , including nonprofit agencies acting as borrowers. You are not eligible for Federally-related credit if CAIVRS indicates that you are presently delinquent on a Federal debt, or have had a claim paid by a federal agency based on a debt you incurred such as a foreclosure or an SBA loan default. For FHA loans, a claim will affect you if such a claim has been paid within the previous three years on a loan made and insured on your behalf by HUD
A debt is in "delinquent status" for purposes of CAIVRS reporting if the debt has not been paid within 90 days of the payment due date. The payment due date is the date specified in the creditor agency's initial written demand for payment or applicable agreement or instrument (including a post-delinquency repayment agreement).
Each federal agency may have its own exceptions to CAIVRS reporting. For instance, FHA-insured mortgages have certain exceptions for divorce, bankruptcy, or case in which a subsequent assuming party defaulted.
You can apply for a CAIVRS waiver from the government agency that you are applying for credit. That is, if you are apply for an SBA backed business loan, but had a CAIVRS claim pay by HUD, you will have to request a CAIVRS waiver from the SBA, not HUD.
A waiver can only be granted by the head of a government agency or the chief financial officer. Your CAIVRS waiver request must meet certain guidelines and provide the requisite information prescribed by Federal law.
If you are dealing with a CAIVRS reporting issue, assertive legal counsel versed in Federal debt workouts can be a great asset. You may have other avenues for eliminating your CAIVRS claim reporting in addition to a waiver request. Protect Law Group focuses on Federal debt issues, including CAIVRS claim reporting issues and waiver requests. Contact one of our Federal debt workout attorneys today for a case evaluation at 1-888-756-9969.
Millions of Dollars in SBA Debts Resolved via Offer in Compromise and Negotiated Repayment Agreements without our Clients filing for Bankruptcy or Facing Home Foreclosure
Millions of Dollars in Treasury Debts Defended Against via AWG Hearings, Treasury Offset Program Resolution, Cross-servicing Disputes, Private Collection Agency Representation, Compromise Offers and Negotiated Repayment Agreements
Our Attorneys are Authorized by the Agency Practice Act to Represent Federal Debtors Nationwide before the SBA, The SBA Office of Hearings and Appeals, the Treasury Department, and the Bureau of Fiscal Service.
Clients personally guaranteed an SBA 504 loan balance of $337,000. The Third Party Lender had obtained a Judgment against the clients. We represented clients before the SBA and negotiated an SBA OIC that was accepted for $30,000.
Clients borrowed and personally guaranteed an SBA 7(a) loan. Clients defaulted on the SBA loan and were sued in federal district court for breach of contract. The SBA lender demanded the Client pledge several personal real estate properties as collateral to reinstate and secure the defaulted SBA loan. We were subsequently hired to intervene and aggressively defend the lawsuit. After several months of litigation, our attorneys negotiated a reinstatement of the SBA loan and a structured workout that did not involve any liens against the Client's personal real estate holdings.
Clients personally guaranteed SBA 504 loan balance of $750,000. Clients also pledged the business’s equipment/inventory and their home as additional collateral. Clients had agreed to a voluntary sale of their home to pay down the balance. We intervened and rejected the proposed home sale. Instead, we negotiated an acceptable term repayment agreement and release of lien on the home.
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