Entries tagged with “FHA”.
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Wed 4 Aug 2010
Posted by karen under FHA
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There’s been a lot of conversation about changing the
structure of FHA loans–and we wanted to let you know
it hasn’t happened…yet!
Here’s a quick synopsis on HUD Press Release 10-150:
HUD Seeks Public Comment on Three Initiatives to Boost FHA Capital Reserves
HUD is accepting comment on the following policy changes:
1. 10% down payment requirement for new FHA borrowers with credit score below 580.
2. Seller concessions to be reduced from 6% to 3%.
3. Tighter UW standards for manual underwrites.
#2 is giving many of us heartburn as it will be the very audience HUD swears to serve, the affordable housing market, that will suffer the most with this change. We would love to see tiered system come out of this instead of a flat across-the-board 3%.
Here is the link to the actual notice in the Federal Register:
Speak now - or forever wish you had!
Make some noise!
Tags: changes, comments, congress, credit, down, FHA, HUD, payment, policy, score, tighter, underwriting
Thu 29 Jul 2010
Posted by karen under FHA
No Comments
(All info provided assumes existing FHA loan was originated
on or after December 15, 1989)
An FHA assumable loan can be an attractive feature on a listed home
for both buyer and seller; especially in today’s declining value market.
Here are some quick facts on FHA assumptions:
· Buyers must credit-qualify to assume existing loan for remaining term.
· Buyer will obtain assumption package from current loan servicer.
· Loan fees are lower than a new-loan origination.
· Sellers will be released of liability.
· No appraisal required.
· Investors do not qualify for assumptions.
· Cash contributions from the seller to facilitate the assumption are not allowed.
· Seller may pay buyer’s closing costs and processing fees.
· The borrower may use secondary financing and borrowed funds.
· Assumptions for use as second home is prohibited UNLESS there is a hardship due to no affordable rental housing available within a reasonable commute distance to employment.
Be sure to do the research on a listing to determine:
· Is this home currently financed with an FHA loan?
· What is the current balance on the loan?
· What is the remaining term of the loan?
· What is the monthly payment?
What is the interest rate on the loan?
Wed 9 Jun 2010
Posted by Tracey Rumsey under FHA
No Comments
We just got done telling you for the last 5 months that the only way we could do a VA loan on a condo was if the project was on the VA approved list. This change is a big deal for the next 6 months and will open up the number of properties available to veteran buyers.
It’s good news, although it will only help us with VA condo loans on most FHA approved projects until December 7 of this year. That’s because the majority of FHA approved projects (those approved prior to October 1, 2008) have to be recertified under the new guidelines (the ones that VA doesn’t like) by December 7.
So for now, it is possible to do a VA loan on a condo under one of the following circumstances:
1. The project is on the VA approved list. http://condopudbuilder.vba.va.gov/2.2/frames.html]
2. The project is on the FHA approved list and was approved before December 7, 2009. : https://entp.hud.gov/idapp/html/condlook.cfm]
At least it may save a few deals between now and then.
Mon 1 Mar 2010
Fannie, Freddie, FHA and VA have made significant changes to the condo approval process–both for existing and new construction.
www.MortgageCurrentcy.com (see Charts/Checklist Toolbar) has created a handy comparison chart to share with your real estate agents! It will help determine what type of financing is eligible for which type of project.
Are you lending in a UDSA area? USDA says that they will accept ANY condo project that is approved by ANY agency–but the location of the condo has to qualify too.
Tags: chart, comparison, condo, construction, eligible, existing, Fannie, FHA, Financing, Freddie, Links, new, usda, VA
Wed 20 Jan 2010
Posted by admin under FHA
[2] Comments
Here’s the entire HUD announcement that appears on their website. No implementation date yet–but looks like late spring/early summer.
So what do you do now?
Get those home buyers OFF THE FENCE–
it’s simply going to cost them more money if they don’t act now!
Here’s the condensed version:
1. UFMIP will be increased form 1.75% to 2.25%. The change to occur in spring 2010.
2. Update the combination of FICO scores and LTV maximum:
o FICO’s less than 580 will see down payment requirements increase to 10%
o This change will be announced in the Federal Register for comment
3. Seller contributions will be reduced from 6% to 3% to conform to the conventional market.
4. Increase audits on FHA lenders
————————————————————————————————————————————————————-
Here’s The Entire HUD Press Release
http://portal.hud.gov/portal/page/portal/HUD/press/press_releases_media_advisories/2010/HUDNo.10-016
HUD No.10-016
Melanie Roussell
(202) 708-0980
|
FOR RELEASE
Wednesday
January 20, 2010 |
FHA Announces Policy Changes to Address Risk and Strengthen Finances
New Measures Will Help FHA Better Manage Risk, While Maintaining Support for the Housing Market and Access for Underserved Communities
WASHINGTON – Federal Housing Administration (FHA) Commissioner David Stevens today announced a set of policy changes to strengthen the FHA’s capital reserves, while enabling the agency to continue to fulfill its mission to provide access to homeownership for underserved communities. The changes announced today are the latest in a series of changes Stevens has enacted in order to better position the FHA to manage its risk while continuing to support the nation’s housing market recovery.
The FHA will propose to take the following steps: increase the mortgage insurance premium (MIP); update the combination of FICO scores and down payments for new borrowers; reduce seller concessions to three percent, from six percent; and implement a series of significant measures aimed at increasing lender enforcement. U.S. Housing and Urban Development Secretary Shaun Donovan previewed the changes in December of last year, noting that the FHA would announce additional details before the end of January.
“Striking the right balance between managing the FHA’s risk, continuing to provide access to underserved communities, and supporting the nation’s economic recovery is critically important,” said Commissioner Stevens. “When combined with the risk management measures announced in September of last year, these changes are among the most significant steps to address risk in the agency’s history. Additionally, by continuing to provide affordable, responsible mortgage products, FHA will support the housing market’s recovery. Importantly, FHA will remain the largest source of home purchase financing for underserved communities.”
Announced FHA Policy Changes:
- Mortgage insurance premium (MIP) will be increased to build up capital reserves and bring back private lending
- The first step will be to raise the up-front MIP by 50 bps to 2.25% and request legislative authority to increase the maximum annual MIP that the FHA can charge.
- If this authority is granted, then the second step will be to shift some of the premium increase from the up-front MIP to the annual MIP.
- This shift will allow for the capital reserves to increase with less impact to the consumer, because the annual MIP is paid over the life of the loan instead of at the time of closing
- The initial up-front increase is included in a Mortgagee Letter to be released tomorrow, January 21st, and will go into effect in the spring.
- Update the combination of FICO scores and down payments for new borrowers.
- New borrowers will now be required to have a minimum FICO score of 580 to qualify for FHA’s 3.5% down payment program. New borrowers with less than a 580 FICO score will be required to put down at least 10%.
- This allows the FHA to better balance its risk and continue to provide access for those borrowers who have historically performed well.
- This change will be posted in the Federal Register in February and, after a notice and comment period, would go into effect in the early summer.
- Reduce allowable seller concessions from 6% to 3%
- The current level exposes the FHA to excess risk by creating incentives to inflate appraised value. This change will bring FHA into conformity with industry standards on seller concessions.
- This change will be posted in the Federal Register in February, and after a notice and comment period, would go into effect in the early summer.
- Increase enforcement on FHA lenders
- Publicly report lender performance rankings to complement currently available Neighborhood Watch data - Will be available on the HUD website on February 1.
- This is an operational change to make information more user-friendly and hold lenders more accountable; it does not require new regulatory action as Neighborhood Watch data is currently publicly available.
- Enhance monitoring of lender performance and compliance with FHA guidelines and standards.
- Implement Credit Watch termination through lender underwriting ID in addition to originating ID.
- This change is included in a Mortgagee Letter to be released tomorrow, January 21st, and is effective immediately.
- Implement statutory authority through regulation of section 256 of the National Housing Act to enforce indemnification provisions for lenders using delegated insuring process
- Specifications of this change will be posted in March, and after a notice and comment period, would go into effect in early summer.
- HUD is pursuing legislative authority to increase enforcement on FHA lenders. Specific authority includes:
- Amendment of section 256 of the National Housing Act to apply indemnification provisions to all Direct Endorsement lenders. This would require all approved mortgagees to assume liability for all of the loans that they originate and underwrite
- Legislative authority permitting HUD maximum flexibility to establish separate “areas” for purposes of review and termination under the Credit Watch initiative. This would provide authority to withdraw originating and underwriting approval for a lender nationwide on the basis of the performance of its regional branches
In addition to the changes proposed today, the FHA is continuing to review its overall response to housing market conditions, and continuing to evaluate its mortgage insurance underwriting standards and its measures to help distressed and underwater borrowers through FHA/HAMP and other FHA initiatives going forward.
Tags: concessions, credit, down, FHA, HUD, increases, low credit score, monthly MIP, payment, risk, score, seller, UFMIP
Wed 21 Oct 2009
Posted by Tracey Rumsey under FHA
No Comments
Maybe a more appropriate headline would be “Make Hay While the Sun Shines -
FHA just announced another delay to the implementation of the new Condo Approval Process to December 7, 2009.
They are claiming that within two weeks they will issue new guidance that will be a kinder, gentler version of the original condo approval process and offer more clarification.
But the really surprising news is that they’ve reversed their position (temporarily) on spot loans. Mortgagee Letter 2009-19 eliminated the spot loan approval process as of June 12, 2009. Now they are telling us that we can do them again until December 7!! Could this be a hint of things to come???
Official Notice Released Today:
FHA notice on delay in FHA condominium changes:
Implementation of FHA’s new policy guidance for condominium project approval and condo unit financing will be delayed until December 7th 2009. The new guidance, to be issued within the next two weeks, will: 1) offer additional leniencies to address the difficult market conditions and 2) augment some portions of FHA Mortgagee Letter 2009-19, providing additional information and clarification.
Until the new guidance takes effect on December 7th, 2009 lenders may continue to use the Spot Loan Approval guidance issued in Mortgagee Letter 1996-41. Further, the site condo and manufactured housing condo project changes that have already been implemented are not affected by this delay.
Wed 16 Sep 2009
Posted by Tracey Rumsey under FHA
No Comments
Originally set to take effect on October 1, I think FHA finally realized that they did not allow enough time for companies to get their arms around the condo re-approvals as outlined in their recent mortgagee letter. Tell your RE Agents that if they have condo listings, which are likely to sell using FHA financing, that a case number needs to be ordered by NOVEMBER 1 because November 2 IS the date that everything starts all over again.
Nothing else has changed! If you want to learn what needs to be done to get the condo projects approved in your area, Tracey Rumsey (FHA expert and one of the speakers at Mastermind) has an online seminar, with step-by-step details on what you need to do.
here\’s the link
http://www.hud.gov/offices/hsg/sfh/hsgsingle.cfm
www.LoanOfficerSeminars.com - which inlcudes a Mortgage Talking Points Flyer/email notice for your real estate agents called Tough TImes Ahead for Condos!
Wed 9 Sep 2009
Posted by Tracey Rumsey under FHA
No Comments
FHA fired the warning shot in December of last year when they issued Mortgagee Letter 2008-39 Revised Eligibility Requirements for FHA Roster Appraisers. They also gave us a reprieve and extended the deadline for these requirements to October 1, 2009.
Go through your approved appraiser lists now and verify that your FHA appraisers are CERTIFIED with the state, not just REGISTERED. If they are not CERTIFIED you cannot use them for properties with case numbers issued on or after October 1, 2009.
Certified and uncertified appraisers alike will still be in the FHA system come October 1, 2009. If you assign an appraisal to a non-certified appraiser the appraisal will be uninsurable. You (the lender) then get to complete (at your expense) a new appraisal performed by a certified appraiser. You MAY NOT charge a borrower for the second appraisal.
Keep in mind that you probably won’t catch this faux pas until FHA informs you that your loan is uninsurable. Then you could be faced with rate-lock expiration issues as you wait with your fingers crossed on the second appraisal, which may or may not come in at the same value with the same property condition requirements. What a party!
Mon 27 Jul 2009
Posted by Tracey Rumsey under FHA
[2] Comments
Did you know that as of October 1, 2009, the FHA spot loan approval process for condo loans has been eliminated? And that MOST condo project approvals will be invalid after that date too?
It’s gonna’ be UGLY–and the only projects that will remain on the list are those that have been approved after October 1, 2008.
If you have any FHA buyers on the fence, looking for just the right condo to purchase, they need to do something or they won’t be able to buy a condo - period - at least for a while. Real estate agents need to advise condo sellers that FHA financing is going to be limited.
A new online seminar can now be viewed at www.LoanOfficerSeminars.com called “FHA Condo Approval Process: What You Need to Know” with audio, slides and all FHA supporting resources.
Mortgage Talking Points(tm) Flyer and email notice also included.
Just when you thought things were getting better–the government takes it away!
Tags: approval, condo, FHA, Links, loan, loanofficerseminars.com, online, points, projects, seminar, spot, talking
Tue 24 Mar 2009
Fannie, Freddie, FHA and VA usually gives you some notice when program or underwriting rules go into effect. Here are some dates that are just around the corner!
April 1, 2009 - FHA eliminates 95% Cash Out refinances. Order your case numbers by March 31–If you order on April 1, it’s too late! More details will be in the April 10, 2009 Rules and Regs Issue.
April 1, 2009 - Start closing loans using Fannie DU Refi Plus
April 1, 2009 - Freddie’s Relief Refi Mortgage goes into effect! Stay tuned–we are hearing that some servicers will be allowing the broker/banker, who originated the loan, to get involved! Start with Flagstar and call your other investors to find out!
May 1, 2009 - Start Using New VA Loan Summary Sheet
May 1, 2009 - Home Valuation Code of Conduct – Check with your lenders-each one has their own rules, including some who will be requiring you to use an appraisal management company for FHA and VA (which is stupid because the “code” specifically exempts these two appraisal types)!
Tags: 95%, Cash-out, DU, Fannie, FHA, Form, Freddie, HUD, HVCC, loan, Mac, Mae, Plus, Refi, Relief, Summary, VA
