Government mortgage programs are all the rage these days–mainly because that’s where the money is. And unlike the crazy, water-tight underwriting of private mortgage programs, government mortgage lenders don’t require that you provide a saliva sample and turn over your first-born child.
However, there is one hard-and-fast test. You’ve got to get through a CAIVRS test. What is CAIVRS? Well, although it’s pronounced “cavers,” it has nothing to do with spelunking.
CAIVRS stands for Credit Alert Interactive Voice Response System. CAIVRS was developed by HUD and is a federal government database that tracks people who have defaulted on federal debts or obligations, have had claims paid on direct or guaranteed federal loans, have a federal lien, judgment or a federal loan that is currently in default or foreclosure, or has had a claim paid by a reporting agency.
CAIVRS contains delinquent borrower records from:
- the Department of Housing and Urban Development (HUD);
- the Department of Veterans Affairs (VA);
- the Department of Education (DOE);
- the Department of Agriculture (USDA);
- the Small Business Administration (SBA);
- the Federal Deposit Insurance Corporation (FDIC); and
- the Department of Justice (DOJ).
All federal agencies that extend credit pre-screen all applicants for delinquencies on federal obligations–it’s required by law. If you have applied for an FHA mortgage or USDA Rural Development Loan and are not delinquent on federal debt and/or do not have a federal tax lien outstanding, then no worries–the check is a mere formality.
However, if CAIVRS indicates that you are delinquent on federal debt or have had a claim paid in the last three years on any HUD loan, you are not eligible for financing. You will have to pay the debt in full or otherwise bring it current under a repayment plan. If approved you will have to obtain a written copy of the plan from the debt holder. (Federal IRS tax liens may remain unpaid provided the IRS subordinates the tax lien to the FHA mortgage.)
Exceptions to this may be granted under the following situations:
- Assumptions: If you sold the property, with or without a release of liability, to a mortgagor who subsequently defaulted and it can be established that the loan was not in default at the time of assumption, you are eligible.
- Divorce: You may be eligible if the divorce decree or legal separation agreement awarded the property and responsibility for payment is to the former spouse. However, if a claim was paid on a mortgage in default at the time of the divorce, you are not eligible.
- Bankruptcy: When the property was included in a bankruptcy that was caused by circumstances beyond your control (such as the death of the principal wage earner, loss of employment due to factory closing, reductions-in-force, etc., or serious long-term illness), you may be eligible
The federal government can be a tough creditor. While it might make you a loan when no one else will, it will also go to great lengths to collect. And it has more power to do so than anyone.
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(19 votes, average: 4.95 out of 5)
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So, if I filed bankruptcy a couple of years ago I could get an FHA loan, but if I blew off a $1,000 student loan I can’t?
That’s exactly right. The government is hard on student loan repayment because otherwise how could it ever get its money back? It’s not like the feds can repossess your education! So if it’s only $1,000 I suggest you pay it. Or perhaps you can get on an approved payment program.
Eek — do delinquent traffic tickets fall into this category as well?
Thanks for the great info.
Melissa,
No, traffic tickets aren’t federal debts. As a 6-time graduate of traffic school I can vouch for that!
Gina
Gina,
Thanks in advance. If one is in default, then has the loans pulled from default status with rehab or consolidation through the Department of Ed, will the caivrs then become acceptable without a 3-year waiting period?
Do you know of any good attorneys that deal with Student Loans that have been mishandled by the servicing State Agencies or Department of Ed?
Jerry, let me see if I get this straight. You WERE in default, but then consolidated your student loans and ARE NO LONGER in default? Was there a claim paid? In other words, did the government reimburse your lender? If there was a claim paid, then you have to wait the three years. If not, you don’t.
There are a couple of ways to cure a default by consolidation–one is to bring the accounts current, then consolidate, the other is to consolidate while in default. The second way gets you a default on your credit record; the first does not.
Hello, Gina
I completed a rehab in 1/06 on my defaulted student loans. They are completely paid in full. I was wondering should there still be a record of this in the CAIVRS system. And am I able to receive a FHA mortgage based on this information.
Hi Shaun,
You have two things going for you. First, the debt has been paid in full. Second, it’s been three years since you completed your rehab. I’d say you’re fine. If by some chance you’re still in the CAIVRS system erroneously, the agency you’ve set up the plan with can fix that. All they have to do is call the CAIVRS line and go through the TELEPHONE SCRIPT FOR GOVERNMENT EMPLOYEES USING CAIVRS.
Hello Gina,
My husband had applied for a UDSA Loan and was denied because he his FHA mortgage was reported by the lender to CAIVRS due to a short sale defiency of 33K. CAIVRS stated they paid the lender in 11/08. He let us know we are not eligible for a FHA or USDA Loan until this debt is paid off. I feel we are being punished because of a bad market and we had to do a short sale in order to sell and to move back to our home state.
Due his being on this CAIVRS can he get a purchase loan any where else and what if hedoes not pay the debt, when will he be eligible for a FHA or USDA Loan?
If so where can we find these loans?
Hi Lena,
If you sold the property (assumable loan) to someone else who THEN defaulted, you’re in the clear. If your husband divorced and the house went to an ex who was responsible for the payments (who THEN defaulted), you’re in the clear. However, it looks like this is the clause that applies to you:
If CAIVRS indicates that you are delinquent on federal debt or have had a claim paid in the last three years on any HUD loan, you are not eligible for financing. This appears to be the case. And from the USDA’s point of view, you have a record of walking away from debt where you had very little of your own money invested (even though these days you probably had a good reason).
Statistically, those who do that, and then get another loan with again almost nothing invested (like a 100% USDA loan) are very likely to do it again. You will have to pay the debt in full or otherwise bring it current under a repayment plan. Have you tried to do a repayment plan? If you get an approved repayment plan, bring a copy to yopur lender and maybe you can still get an USDA loan.
For extra help, go to my post Can I Get a Mortgage After Filing Bankruptcy? Because it has lots of advice for cleaning up your credit and writing a letter to lenders about how you got into trouble and what you have done to make sure it never happens again.
Lenders like that.
My wife and recently tried to refinance. Everything was approved and we were getting ready to sign paperwork on a FHA loan. They called and said my wife showed up on Caivrs. In 2006 her exhusband lost his job therefore she didnt get child support. She fell behind on payments but was able to sell the house before foreclosure for what she owed. She called the number on the Caivrs report and they said she was listed because it was a pre-foreclosure sale and it will go off in Aug 09. He also said in this case it was up to the lender to go ahead with loan. Our broker said they cant. Should she even be listed on cairvs the house was never foreclosed.?
Hi Gina,
I’m trying to purchase a house thru FHA Loan, and suddenly something came up in the CAIRS system an SBA default Loan. I went bankrupt chapter 7 4 years ago an included this loan under bankruptcy how can I remove that from te CAIVRS system.
Hi, Mike,
The lucky thing about SBA loans is that unlike most federal debt you can discharge them in bankruptcy like any other business loan. Further, an SBA loan included in a bankruptcy may be removed from CAIVRS if the bankruptcy was caused by circumstances beyond your control (such as the death of the principal wage earner, loss of employment due to factory closing, reductions-in-force, etc., or serious long-term illness), you may be eligible.
Your other option may be to call the SBA and get on a repayment plan if in exchange they will remove you from CAIVRS. I’d probably have my BK attorney on this. I don’t know what your amount discharged was–you may have to run some numbers and see what makes more sense–paying off the loan (in exchange for a clean CAIVRS) or cleaning everything else up and saving some cash until you can do a Fannie Mae loan. Your BK at least has some distance on it between you and it, but Fannie Mae does have some ugly add-ons for credit boogers. If you can work an affordable repayment planb for the SBA (I believe they remove you from CAIVRS after 6 -12 months of on-time payments) that may be your best bet. But call a HUD counselor or get a lawyer to make sure.
Good Luck!
Gina
Hi Jason,
If the home was sold for what was owed, then presumably there was no claim paid by HUD and I don’t see whay she would be listed on CAIVRS. If you are using a broker, it’s not likely your broker’s decision to allow the loan to go through but the decision of whatever lender your loan is being put through. So if that’s the case, why isn’t your broker doing his / her job and finding a different lender? The primary advantage of using a broker rather than a bank is that brokers should be able to find a home for your loan by shopping the file with a variety of lenders.
In addition, a good lender pulls a CAIVRS immediately, far in advance of doing anything else with your loan. HUD even states that that is the first thing a lender should do. I’d get the broker to release your case number if the job isn’t getting done and go elsewhere. Rates have been moving up–I wouldn’t want to wait until August.
Hi Gina,
Wonderful site. Very informative.
Is there way for a person to check themselves to see if they are listed on CAIVRS or do I have thru an agency?
Unfortunately, CAIVRS is guarded pretty closely. Or maybe fortunately, given the ease some people have in stealing identities ets. Anyway, according to HUD,
“CAIVRS allows authorized employees of participating Federal agencies to access a database of delinquent Federal borrowers for the purpose of pre-screening direct loan applicants for credit worthiness, and permits approved private lenders acting on the Government’s behalf to access the delinquent borrower database for the purpose of pre-screening the credit worthiness of applicants for Federally guaranteed loans.”
So your best bet is to have a HUD-approved lender do the checking for you. If there is any reason you think you might be on CAIVRS, you might also check with the agency that you think might have reported you (for example, the IRS) and ask them. And being on CAIVRS by mistake isn’t uncommon and can be fixed. You don’t have to walk into your lender’s office with a bag on your head or anything
Hi Gina,
My wife and I had a foreclosure on a FHA loan that was paid on June 23rd of 2006. It has been over 3 years now and we were approved for a VA loan, but cannot clear caivrs, even though it has been over the 3 year mark. The VA is sending me a letter saying that we meet their criteria for a mortgage. What can we do to pass caivrs or get our foreclosure cleared?
I had a small business that failed in 2005 and we lost our home of 30 years. Legally the foreclosure was in Jan. 2006 and in Aug. 2006 I accepted a IT position in a growing medicaid insurance company. We have been paying off old debts and saving to buy another home for 3 years now, and with the foreclosure 3 1/2 years behind us things were looking up. We were pre-approved, found a great house we could afford, locked in a good rate and started packing! Just when we thought nothing could go wrong..the CAIVRS bomb hit! According to them, I am not eligible until June 2010.. 4 1/2 years after we were clear of our foreclosure. Our house deal fell apart and I was out a few $$$ plus emotional stress. I am assuming our only option is wait out the next 11 months…
Tony
Warren, MI
I am in caivrs for back child support I have payed up but how do I get caivrs so I can stream lime my house loan. Who do I call please send me a phone number of who to contact. Thank you
I have in the last month paid off a debt to the VA for an overpayment they made to me in 1998. I am trying to get my new home closed on and even though the VA loan is off of the caivrs there is still an alert. The underwriter called the HOC and they were told that the alert won’t come off of my report for 45-60 days after the debt was paid. My underwriter will not do the loan until the caviers alert is removed. He told me I had nothing else on my report the just said I had to wait until it comes off. Just the alert is there. Well my home is complete and the builder is ready to close. Is this 60 day waiting period accurate? What can I do to get it removed now as I feel I am blacklisted for no good reason.
I stand to loose lots of money and already gave my notice to vacate my apartment. HELP…..
Hi Carol,
Sorry it took me a while to get to you. I try to respond right away and you got trapped in my 808 emails. I apologize because it looks like you need to move on this ASAP. Actually , the lender has the discretion to approve your loan in this circumstance. If it isn’t going to close your close, let your loan officer know that you are taking it elsewhere. Call around and find someone who will do it. Then collect your package from your current lender and switch.
For everyone who needs a caivrs update or mistake fixed:
So your best bet is to have a HUD-approved lender do the checking for you. There is no way for a “civilian” to get access. You might try a HUD-approved housing counselor if you don’t want to deal with a lender.
If there is any reason you think you might be on CAIVRS, you might also check with the agency that you think might have reported you (for example, the IRS) and ask them. And being on CAIVRS by mistake isn’t uncommon and can be fixed. You don’t have to walk into your lender’s office with a bag on your head or anything.
I am trying to buy a home with an FHA loan. My very old defaulted student loan came up on CAIVRS.
I am able to pay the student loan in full through a settlement agreement with a third party that was retained by DOE.
How long after being paid will it take for the CAIVRS system to show an all clear thus making and FHA loan possible?
Thank you.
I had a CAIVRS checked by broker and it showed a default on a FHA mortgage that was listed in a chapter 7 discharge. The property is in the process of selling with a realtor that will provide the FHA over 90% of the balance due. Can the CAIVRS be cleared when the property sells with out paying the remaining 10%.
Discharge was in 2004.
If it does not clear is, it possible to get a USDA 502 based on the exemption status of a bankruptcy that included the property.
Credit score is above 620 for all three credit reports.
I have a Caivrs as well. The house was sold via short sale and I had an FHA loan. I also paid PMI during the course of the loan which FHA made a claim against. Why wouldn’t it be true that since FHA didn’t lose out on any money, I should qualify for another FHA or Rural Housing loan because there wouldn’t have been any money owed or lost to them.
I had a hit on my Caivrs as well. I was charged with crime by DOJ and I’m paying $200.00 a month until I pay off the balance what is now $8,800.00 I recently had a VA loan fall apart the day before closing because of this. I was never late on paying on this and didn’t think it would be a problem, I never had any other problem. Is there any way to remove this from Caivrs?
My husband filed bk7 in 2006 and was also discharged in 2006. He included a conventional mortgage loan (that sold from one lender to another over and over again). After being offered to do a deed in lieu we paid the $100 required and went ahead to find out a year later that they couldn’t do it due to a 2nd on the house. It went to sheriffs sale and transfrerred out of his name in June 2009. We are getting ready to apply for a usda rural loan. Will this conventional foreclosure show up on CAIVRS and disqualify us?
Thanks, Lisa
Conventional loans are not reported to CAIVRS. If you have reestablished credit since the Ch 7 you should be fine.
I paid off a judgement for the Dep. of justice 2 months ago but it’s still showing. when I called them they told me everything was paid in full but they cant take the Caivers off. I asked to explain why and they said they never set it up in the first place but on the report it clearly states there name. lost the loan because of this even though I had proff of payment. What can I do????
Hi Paul,
The agency responsible must clear the file. HUD cannot do it. However, the lender can do two things for you (and should have). First, it can give you the information on the source of the filing so you can prove to the agency that it is the source of the bad info. Second, the lender can approve your loan with the CAIVRS entry as long as it documents that you have proven that the entry has been paid. Go after the DOJ but also find another lender. Explain upfront what the problem is and ask if they can approve your loan if you prove the judgment has been paid.
I’m in an interesting perdicament, my mortgage application was cleared by the local underwriting at my mortgage broker, however two weeks before we are supposed to close they pull a Caivrs. Naturally this was pulled Late in the game.
My wife and I did a short sale and have a closed date of Feb 2007, my credit report even indicates that Wells Fargo received the final payment in Feb 2007. However the FHA resouce center is stating they didnt pay the claim until Oct 2007 so we arent eligble until Oct 2010. Half our house is packed up. The resource center wont accept any of our documentation.
Is this normal? Thanks!
My husband is the only one that will be on the FHA loan documents, however, now 2 weeks before closing, the underwriters want to see my repayment agreement with my Student Loan… since I was technically in default, but in working on an agreement in a rehabilitated default program. Can this hurt my husbands chances of getting the loan even if I am not on it at all? I am not on the loan, deed, nothing…. why do they want my info? can anyone help me?
Hi Lisa,
The only thing I can think of is that they want to determine if your husband has contingent liability for your student loan. In the case of married borrowers, newly divorced borrowers, or those who co-sign for loans, underwriters often want to verify that the person responsible for the loan is making the payments as agreed, or that the borrower is not on the hook if the responsible party defaults. If he has contingent liability, the underwriters will want to make sure that his income is sufficient to cover that in addition to his own bills. If not, then there should be no problem.
Gina
Hi Lisa,
I am a Realtor selling a property to some nice folks that were in the Katrina disaster and received a loan thru sba
Until it showed up on caivrs the lender and myself had no idea the debt existed
It was not on their credit report
We have been told that my cleint can negotiate a payoff in full.
And only the originator of the claim can remove it
If we are successful with a payoff- any ideas on who can we contact to remove the paid debt from caivrs–
Thanks, Paul
Hi Paul,
The creditor should remove the debt from CAIVRS when it is paid. The lender can verify it when that occurs.
Gina,
I also filed chapter 7 with the mortgage loan included in the bankruptcy. My house is up for auction and I’m not sure what it will sell for. The bankruptcy was released January 2009. How long before we could get a clear caivrs number? Would it be 3 years after the house is sold by the bank before I could get another loan?
Also what is the difference in a conventional loan and one with FHA?
Hi Jeff,
If your mortgage was not a government-backed home loan, your bankruptcy / default should not get you listed on CAIVRS. Conventional mortgages are any that are not backed by government insurance. FHA, USDA, and VA mortgages are examples of government loans. Fannie Mae, Freddie Mac, and jumbo loans are conventional loans. To get an FHA mortgage in the future, you’ll need to have a clean credit history for at least three years following a foreclosure to be considered for approval.
Hi Gina,
I have a student loan being rehabbed out of default (it goes back to a lender at the end of May). The loan went into default of 3/2009. My wife has perfect credit and we are interested in a FHA loan using only her as the borrower. I’m assuming that my CAIVRS will be tarnished for the next three years, but will that stop my wife from getting approved via FHA. We live in CA if that makes any difference. Thanks!
Hi Alan,
If your wife does not have contingent liability on your student loan (she hasn’t co-signed or anything), it should not affect her ability to get an FHA mortgage.
Good luck!
Thanks Gina.
I’m worried that being a “community property” state might make things different, though. I’m hoping the site below is in error about the non-purchasing spouse part at the bottom:
http://www.fha-guidelines.com/caivrs.htm
That site is not a government site; it’s a commercial one. A check on HUD’s credit underwriting guidelines http://www.hud.gov/offices/adm/hudclips/handbooks/hsgh/4155.1/41551c2HSGH.pdf finds no mention of CAIVRS and non-purchasing spouses. However, it does show that in community property states, the non-purchasing spouse’s debts must be considered in the borrower’s debt-to-income ratios. In addition, you must quit claim (sign away all rights to) the property. For a VA mortgage, the spouse showing up on caivrs doesn’t necessarily preclude loan approval but it is considered a negative factor. One thing to keep in mind, however, is that lenders are free to impose stricter guidelines than FHA requires and may do so to keep their default rates down and maintain their FHA approval.
I am currently in foreclosure and have a FHA loan. I am assuming this debt will be reported to CAIVRS. Is there a time frame before I can qualify again for another FHA loan? I’ve heard of different timelines anywhere from 3-7 yrs. I’ve also read it could be 4 yrs from the date of the foreclosure to 4 yrs from the date the CAIVRS debt is paid. Is it possible to never pay the debt and still qualify for a FHA loan after a certain amount of time has passed? Thank you!!!
I’m going for a FHA 203 rehb loan I owe the IRS in back taxes but I have no tax lien will I show up on caivrs.
Ben, if you have no lien and are on a payment plan you’ll have to include that debt in your application but are most likely not on CAIVRS. Peter, your FHA foreclosure will get you on CAIVRS. Here’s what HUD has to say about it:
Question 6: How long does this remain in CAIVRS after the claim is paid?
Answer: It remains in the system for 38 months after the claim is paid; however, 36 months after the claim is paid the borrower(s) are eligible for a new loan. Reference HUD Handbook 4155.1, 4.A.2.c, Handbook 4155.1, 4.A.8.a and Handbook 4155.1, 4.A.8b.
Hello we are in a similar predicament as Jason above on 5/31/10. Our mortgage application for a USDA loan was cleared by the mortgage broker, however two weeks before we are supposed to close they pull a Caivrs and my fiances foreclosure from 9/06/2007 is on it. We have court papers stating that the bank foreclosed in 2007, though HUD repayed the balance due to Wells Fargo after the sale in 2009. According to HUD it states “A borrower is not eligible for an FHA mortgage if he is presently delinquent on any type of Federal debt, unless the delinquent debt is paid in full or otherwise brought current under a repayment plan approved by the Federal agency that is the holder of the debt.
If the borrower is under an approved repayment plan with the debt holder, the borrower will have to obtain a written copy of it from the debt holder. (Federal IRS tax liens may remain unpaid provided the IRS subordinates the tax lien to the FHA mortgage.)
For a borrower that had an FHA mortgage foreclosed, that borrower is not eligible to apply for another FHA mortgage until three years after the date that HUD paid the insurance claim to the lender. The names of FHA borrowers are automatically deleted from CAIVRS when this three year waiting period expires.”
CONFUSING, so if he is on a payment plan, will USDA reconsider his application for repayment. We also called HUD and they say we need to contact the lender, well if the original lender was repaid by HUD in 2009, wouldn’t HUD be the one we need to talk to about repaying them? Where can we get some answers quick because we will be homeless in 17 days, thank you.