A foreclosure waiting for the perfect buyer.
There’s some changes coming ’round the bend, my friends… If you are still thinking about purchasing a home with an FHA mortgage, you should know that the Mortgage Insurance Premiums are on the move… Up.
The Renovation Loans, FHA 203K and Fannie Mae Homepath loans, are also making a few changes… Read up below. Call me with any questions, we can make this so much easier than it sounds.
•FHA Changes Start April 1 –
The Annual Mortgage Insurance Premiums are going up again, and for FHA loans with standard down payments, PMI will now remain for the LIFE OF THE LOAN. Buyers must be assigned a FHA Case number prior to April 1st which essentially means by this Friday, March 29. Thinking about getting an FHA Loan? Your best bet is not to wait much longer…
• Are there any restrictions for Well & Septic on Conventional Renovation loans?
NO. Unlike FHA, when using a conventional renovation loan on home that has well & septic there are no specific guidelines to hold you up. No distances, etc.
• Did HUD make changes on As-Is Values and Appraisals?
Yes. On a HUD REO the As-Is appraisal value is valid until the appraisal expires after 120 days. So, if you offer more than the As-Is value for the sales price you must bring the additional cash to closing on top of the required 3.5% down payment. Regardless if you use a FHA 203k loan with a new appraisal, the original AS-Is value must be recognized for 120 days.
• When is an appraisal ordered on a FHA 203k or conventional renovation loan?
The appraisal is not ordered until the Scope of Repairs is completed and signed by both parties. The appraisal is done subject-to the After-Improved value, so while you get the value ahead of time, the actual work is not done until AFTER CLOSING. On FHA 203k loans you get up to 110% of the after-improved value – or 10% buffer.
• What are the minimum down payment requirements for a HomePath mortgage?
For owner-occupied properties its 3%. For second homes its 10% and for investment properties its 10% down. This applies even to condos. However, for 2-4 unit properties there are additional down payment requirements.