Changes Coming in Lending Guidelines
Courtesy of Jim Duffy of Atlantic Bay Mortgage
"Conventional is getting easier; Government is getting tighter"
Changes are coming up in mortgage lending industry, some of which may affect home buyers.
A. Fannie Mae: Vested Retirement Funds can be used more easily. If they don't need the whole amount for down payment, then we do not need verification that the funds are liquidated from the retirement accounts. Translation: Less paperwork for buyers = happier buyers.
B. USDA Rural Housing: The Guarantee Fee (the fee that is added to the loan amount) is rising from 2% of loan amount to 2.75% of the loan amount. Bummer. That starts Oct 1; so if you are planning to use a USDA loan, let's hurry to get a home under contract if possible (Call us ASAP on 843-900-0155).
C. Freddie Mac & Fannie Mae - Multiple Properties: For loans with Closing Dates October 26 or after - Freddie Mac will go from allowing 4 financed properties to 6. After Oct 26, Freddie Mac will allow investment properties 5-6 to be financed at 85%, or with 15% down payment. Fannie Mae allows up to 10 financed properties, but they require a larger down payment. And the two-year history of managing investment properties to use rental income will be waived. So, rent comps can be used to offset the rent and help buyers qualify.
Investors - call us today to get you a property before prices go up further - it will be much easier to qualify you for a loan.
D. VA Streamline refinances are going to get a bit tougher. If you are thinking about refinancing your VA loan, don't wait! Do it now!
E. Fannie Mae Will Change the Limited Review for Non-warrantable Condos, and only require 10% down payment (currently they require 20% down). Still 25% down on 2nd homes. Easier to buy condos.
F. FHA Buyers: For Contracts that come in AFTER September 14, lenders will have to count Student Loans in your debt ratio, even though they may be deferred for a year or more. Right now, lenders don't count that debt. So, just like USDA above, if you are thinking of using an FHA loan, place a home under contract right now, don't delay, because after September 14 you may not qualify for the same amount.
Download our FREE Buyer's Guide (Summer 2015 edition)
Call us on 843-900-0155 to schedule a Free, No-Obligation Buyer Consultation.
Watch Video: "Upcoming Changes in the Home Lending Process"
Please contact us if you have any questions or comments.