New changes to the FHA program
Beginning on July 14, 2008 new rules for the FHA loan program will go into effect. These changes will affect many borrowers looking to refinance out of a non-FHA (Conventional or VA) to an FHA loan. These new rules will affect the rate and future refinances. In short, FHA is tightening their guidelines just like the conventional markets. Loans that were easily approved a year ago are only approvable with much more documentation or not approved at all.
1. Refinancing from any non-FHA mortgage to an FHA loan will now be required to be an FHASecure product. Previously the FHASecure product was used only for borrowers who were delinquent on their non-FHA mortgage due to the Adjustable Rate Mortgage (ARM) adjusting to a higher rate.
It now includes borrowers who are not delinquent on their mortgage, but currently have a Conventional or VA loan and want to refinance to the FHA loan product. This particular FHA loan carries a bit higher rate than a regular FHA loan.
2. Cash-out refinances are not allowed on the FHASecure program regardless of whether the borrower is delinquent or current on their mortgage payments. Previous rules allowed for non-FHA mortgage loans to be refinanced to a regular FHA and receive cash out up to 95% of property value. Now, the only way a person can get cash out with an FHA loan is if they already have an FHA loan.
3. The premium paid for the Upfront Mortgage Insurance (MIP) and monthly mortgage insurance can increase depending on the borrower’s credit history, loan-to-value and credit score. Previous rules with the monthly and up-front mortgage insurance premiums were the same across the board.
4. First time home buyer (a person that has not owned a home in the past 3 years) with low credit scores are entitled to a reduction of the up-front mortgage insurance premium by completing a HUD-approved pre-purchase counseling course.
For further details on the new expanded FHASecure program please contact Denise Wing at 303-987-0622.
Denise Wing, C.E.O
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net
1. Refinancing from any non-FHA mortgage to an FHA loan will now be required to be an FHASecure product. Previously the FHASecure product was used only for borrowers who were delinquent on their non-FHA mortgage due to the Adjustable Rate Mortgage (ARM) adjusting to a higher rate.
It now includes borrowers who are not delinquent on their mortgage, but currently have a Conventional or VA loan and want to refinance to the FHA loan product. This particular FHA loan carries a bit higher rate than a regular FHA loan.
2. Cash-out refinances are not allowed on the FHASecure program regardless of whether the borrower is delinquent or current on their mortgage payments. Previous rules allowed for non-FHA mortgage loans to be refinanced to a regular FHA and receive cash out up to 95% of property value. Now, the only way a person can get cash out with an FHA loan is if they already have an FHA loan.
3. The premium paid for the Upfront Mortgage Insurance (MIP) and monthly mortgage insurance can increase depending on the borrower’s credit history, loan-to-value and credit score. Previous rules with the monthly and up-front mortgage insurance premiums were the same across the board.
4. First time home buyer (a person that has not owned a home in the past 3 years) with low credit scores are entitled to a reduction of the up-front mortgage insurance premium by completing a HUD-approved pre-purchase counseling course.
For further details on the new expanded FHASecure program please contact Denise Wing at 303-987-0622.
Denise Wing, C.E.O
Certified Mortgage Lender
Academy National Mortgage Corporation
303-987-0622
dwing@academynational.net
posted by Academy National Mortgage at 10:22 AM
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