NEW FHA RULES!

By
Mortgage and Lending with Franklin American Mortgage NMLS 470753

As if structuring mortgages isn't confusing enough for our customers, now with the new 3.5% required down payment or required investment from our borrowers, and all the new rules that ensue, this will be even more complicated to structure for those borrowers that struggle with down payment on their first home.  

 The 3.5% required borrowers investment cannot include closing costs, and although we can get our sellers to pay these, I believe all the closing costs, concessions,and PMI all thrown together cannot exceed appraised value. 

 I thought the new housing bill, passed in October, was set to help eliminate the down payment assistance programs. However, with the FHA changes as of January 1st, more and more borrowers will be forced to utilize the UP TO 6% Seller paids or concessions.  This generally drives up the purchase price, and appraised value. Did this help the initial problem? 

 Yes, we have the tax credit of $7500, AND unlimited gift funds can be used for down payment on an FHA mortgage, however, what if our customer does not have an immediate family member with $$. 

Does anyone have any creative ideas for structuring these loans for our borrower's

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Wanda Promes

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