NEW FHA GUIDELINES

FHA Waives 90-Day Flipping Rule for Foreclosures

FHA and FREDDIE MACK loan limits boosted and in effect until end of 2008!

BROWARD -

TEMP FHA LOAN LIMIT IS $423,750 - FANTASTIC OPPORTUNITY FOR THOSE WHO NEED TO REFINANCE EXISTING HIGH INTEREST LOAN OR FOR BUYERS GETTING INTO THE MARKET AT THIS TIME AND HAVE LOWER CREDTI SCORES, LESS INCOME AND LESS AVAILABLE FOR DOWN PAYMENTS - FIRST TIME BUYERS CAN COME IN WITH AS LOW AS 3% AND HAVE THE CLOSING COSTS ROLLED INTO THE LOAN FOR UP TO 6% ...

(CALL 954-531-8100 for more information)

If you need a new loan call 954-531-8100... we have wholesale FHA approved lenders

FHA, Conforming Limits Boosted $729,750 limit effective July 1 to Dec. 31 February 13, 2008 By SAM GARCIA President Bush has signed into law emergency legislation that will temporarily increase the conforming limit by 75 percent. In addition, the limit for loans insured by the Federal Housing Administration will also see a temporary boost. H.R. 5140, the Economic Stimulus Act of 2008, was signed by Bush this afternoon. The bill is intended to jumpstart the ailing U.S. economy and help the country avert a recession -

Among the pieces of the new law is a temporary increase in the conforming loan limit and the FHA limit. The conforming limit, which is the maximum amount of a residential mortgage that can be purchased by government sponsored housing enterprises Fannie Mae or Freddie Mac, is currently $417,000. However, under H.R. 5140, the conforming limit will be increased by 75 percent to $729,750 from July 1, 2008, until Dec. 31, 2008.

The temporary increase to the conforming loan amount is limited, however, to 125 percent of an area's median home price as determined by the U.S. Department of Housing and Urban Development. HUD is required to post area median prices and loan limits within 30 days.

(see FHA loan limits by county and state)

FHA loans and what it means for buyers

Latest news:

FHA insures mortgage up to 97% loan to value and only up to 6 % for down Payment and and closing costs.

(Are your customers having trouble making their monthly mortgage payments?.. If you are a realtor call us we can get your buyer into a home with the best loan around!!)

Refinance now with a FHA: the best option for those stuck in subprime or ARM mortgages is a new FHA loan. An FHA loan is a mortgage loan that is insured by the U.S. government. Since the government insures the mortgage loan, lenders will be more willing to give out loans with fewer requirements and stipulations.

WHO INSURES THE LOAN? WHO GIVES YOU THE MONEY?

With an FHA loan, the government doesn't actually give you the mortgage loan, a lender does (lenders can be institutions like banks or mortgage brokers). No credit score requirements, lower down payment requirements, low closing costs,

Basics - To get an FHA mortgage loan, aside from the fact that the property (or Subdivision property is in) needs to qualify to receive an FHA loan you've got to have a valid social security number, be a legal resident of the United States, and be of legal age to sign on a mortgage (this age varies from state to state)

Employment - Ideally, you'll be able to show FHA that you've maintained steady employment for the last three years. This would mostly be to prove that you are capable of making regular mortgage payments without difficulty. However, there are no fixed employment requirements for an FHA mortgage loan Income -

Income: As with the above category, there are no minimum income requirements for an FHA loan. Rather, you must simply show that you have had continual income for the past two years. What constitutes income? Full-time wages from your employer, part-time pay, overtime pay, bonuses, seasonal pay, pension, child support paid to you, alimony paid to you, even rent paid by family members to you. Government-based sources of income can also be included, such as social security payments, unemployment compensation, military pay, and VA benefits.

Credit Scores: You do not need perfect credit to qualify for an FHA loan as long as there is a good reason for any past credit problems. There are two real credit requirements for an FHA mortgage loan: in the past two years, you should have no bankruptcies, and in the past three years, you should have no foreclosures (or deed-in-lieu of foreclosures). Debt to Income Ratio - FHA guidelines are that a borrower's use not more than 29% of their monthly income (Front Ratio) towards paying off housing costs and borrower's use more not more than 41% towards other long-term debt (Back Ratio).

Both of those figures apply to loans for existing dwellings, for new construction the figures are 31% and 43%, respectively. However, we have seen approvals with Back Ratios as high 55%. With this in mind, remember that your income will determine how much your monthly mortgage payment to FHA will be - your monthly mortgage payment should not exceed 29% (with exceptions) of your monthly income.

Down Payment: When buying a home the down payment is a percentage of the home's total value to be paid in cash upon obtaining the mortgage loan. For many low- and moderate-income amilies, a large sum of cash is hard to come by. Fortunately, the FHA has one of the smallest down payment requirements among all home loans. The minimum down payment for an FHA loan is less than 3% and will never exceed 5%. FHA allows 100% of the down payment to be a gift from friends, family, or other sources (that is, if you know someone particularly generous, they can pay the entire down payment for you).

Cahs Reserves: Borrowers usually use their own cash reserves to pay the down payment, but can also use cash gifts and private savings to pay it as welI. If you plan to repair or improve the house yourself, you can use this manual labor as a percentage of the down payment, too.

Extraordinary Programs: There are a few extraordinary programs operated by HUD that directly involve HUD Homes. Formerly known as the "Teacher Next Door" and "Officer Next Door" rograms, they are now collectively called the "Good Neighbor Next Door" program. In this program, any teacher, law enforcement officer, emergency medical technician or firefighter can purchase a HUD Home located in a "revitalization area" at a 50% discount. That is, if HUD lists a home at $100,000, then a participant in the Good Neighbor Next Door program will be able to purchase that house for only $50,000. This deal may seem too good to be true - it's difficult to get things at the grocery store for 50% off, let alone get a home for 50% off. But the purpose of the Good Neighbor Next Door program is to improve the state of America's communities, and HUD believes that this huge discount will attract upstanding citizens to areas where they are needed.

In order to be an eligible participant, you must: Be employed full-time By employed as a teacher, law enforcement officer, firefighter or emergency medical technician Be able to live in the HUD iscounted home for 3 full years Use a real estate broker or agent to buy the discounted HUD Home Funds for Handyman-Specials and Fixer-Uppers The purchase of a house that needs repair is often a catch-22 situation, because the bank won't lend the money to buy the house until the repairs are complete, and the repairs can't be done until the house has been purchased.

HUD's 203(k) program can help you with this quagmire and allow you to purchase or refinance a property plus include in the loan the cost of making the repairs and improvements. The FHA insured 203(k) loan is provided through approved mortgage lenders nationwide. It is available to persons wanting to occupy the home. A potential homebuyer locates a fixer-upper and executes a sales contract after doing a feasibility analysis of the property with their real estate professional.

The contract should state that the buyer is seeking a 203(k) loan and that the contract is ontingent on loan approval based on additional required repairs by the FHA or the lender. The homebuyer then selects an FHA-approved 203(k) lender and arranges for a detailed proposal showing the scope of work to be done, including a detailed cost estimate on each repair or improvement of the project.

The appraisal is performed to determine the value of the property after renovation. If the borrower passes the lender's credit-worthiness test, the loan closes for an amount that will cover the purchase or refinance cost of the property, the remodeling costs and the allowable closing costs.

The amount of the loan will also include a contingency reserve of 10% to 20% of the total remodeling costs and is used to cover any extra work not included in the original proposal. At losing, the seller of the property is paid off and the remaining funds are put in an escrow account to pay for the repairs and improvements during the rehabilitation period. The mortgage payments and remodeling begin after the loan closes.

The borrower can decide to have up to six mortgage payments (PITI) put into the cost of rehabilitation if the property is not going to be occupied during construction, but it cannot exceed the length of time it is estimated to complete the rehab. Escrowed funds are released to the contractor during construction through a series of draw requests for completed work. To ensure completion of the job, 10% of each draw is held back; this money is paid after the lender determines their will be no liens on the property.

The information published here is purely informative only and should you need further information or erification of the FHA guidelines call us or call contact the Federal HOusing Administration office direct.

published: April 14, 2008