Monday, January 19, 2009

FHA Tid-Bit: Full-Qualifying vs Streamline Refinance

When does an FHA loan have to be full credit qualifying?

If the new loan amount is higher than the original loan amount, but, the new payment is less than 120% of the original payment, the loan is still an FHA Streamline.

But, if the payment goes over 120% of the original payment it becomes a full credit qualifying FHA loan.

Friday, January 16, 2009

FHA Mortgage Insurance Premiums

To clarify the amounts charged for FHA Mortgage Insurance Premiums, please see below. You can read the entire mortgagee letter at.... http://portal.hud.gov/pls/portal/docs/PAGE/FHA_HOME/LENDERS/MORTGAGEE_LETTERS/2008_MORTGAGEE_LETTERS/08-22%20MORATORIUM%20ON%20RISK-BASED%20PREMIUMS%20FOR%20FHA%20MORTGAGE%20INSURANCE.DOC

In summary:

Upfront Premiums: FHA will charge an upfront premium in an amount equal to the following percentages of the mortgage:

Purchase Money Mortgages and Full-Credit Qualifying Refinances = 1.75%

Streamline Refinances (all types) = 1.50%

Annual Premium: Loan Term is "over" 15 years -

Over 95% LTV = .55% per year

Less than 95% = .50% per year

Annual Premium: Term is 15 Years or less

90.01% or greater = .25% per year

90% LTV or less = No Annual Premium

Monday, January 5, 2009

Notice: Running AUS files as of Jan 1, 2009

The new FHA guidelines that went into effect Jan 1, 2009 are not in DU / DO and will not be incorporated by Fannie Mae in an update until Jan 24, 2009.

Until then, we will continue to accept DU findings but will manually work around the problems associated with the calculations.

We'll post other updates and notices about this problem as they arise.

Friday, December 26, 2008

FHA MORTGAGEE LETTER 2008-40: Refinance Transactions: New Maximum Mortgage Calculation

Refinance Transactions: New Maximum Mortgage Calculation

The Housing and Economic Recovery Act of 2008 revised the National Housing Act to:

Eliminate the variable loan-to-value (LTV) limits that were based on the combination of the property value and the average closing costs of the State where the property is located and
Limit the total FHA-insured first mortgage to 100 percent of the appraised value, and permit the inclusion of the upfront mortgage insurance premium (UFMIP) within that limit.

For simplicity purposes, and to eliminate any confusion in the marketplace, effective for case numbers assigned on or after January 1, 2009 the maximum LTV for most refinance transactions will be 97.75 percent. A summary of maximum LTVs is shown in the chart, along with the complete Mortgage Letter at http://portal.hud.gov/pls/portal/docs/PAGE/FHA_HOME/LENDERS/MORTGAGEE_LETTERS/2008_MORTGAGEE_LETTERS/08-40%20REFINANCE%20TRANSACTIONS%2C%20NEW%20MAXIMUM%20MORTGAGE%20CALCULATION.DOC .

A matrix comparing rates and terms, streamlined with and without appraisals, is provided at http://portal.hud.gov/pls/portal/docs/PAGE/FHA_HOME/LENDERS/MORTGAGEE_LETTERS/2008_MORTGAGEE_LETTERS/ATTACHMENT%20FOR%20ML%2008-40%20REFINANCE%20TRANSACTIONS%2C%20NEW%20MAXIMUM%20MORTGAGE%20CALCULATION.DOC .

FHA Mortgagee Letter 2008-41: Termination of FHASecure

Termination of FHASecure


While FHA will retain its standard rate-and-term refinance program for borrowers who are current on their existing mortgages, the FHASecure program under which FHA was able to insure refinance transactions for borrows delinquent on their mortgages, will terminate on December 31, 2008, as per FHA’s initial guidance. Maintaining the program past the original termination date would have a negative financial impact on the MMI Fund that would have to be offset by either substantial across-the-board single family program premium increases or the suspension of FHA’s single family insurance programs altogether.

Timing
As of December 31, 2008, FHA will not issue any new case numbers for lenders seeking to refinance borrowers into FHASecure loans. Any loans for which the lender has requested a case number and taken a loan application prior to December 31, 2008 may be processed and will be insured by FHA.

To review the complete Mortgagee Letter, go to -
http://portal.hud.gov/pls/portal/docs/PAGE/FHA_HOME/LENDERS/MORTGAGEE_LETTERS/2008_MORTGAGEE_LETTERS/08-41%20TERMINATION%20OF%20FHASECURE.DOC

FHA Keeps One FHA Secure Option for Refis

From Origination News http://originationnews.com/plus/#1230138003

FHA Keeps One FHA Secure Option for Refis

December 24, 2008

The Department of Housing and Urban Development is terminating the FHA Secure program for refinancing delinquent borrowers, but it is still keeping one option that made it easier for borrowers with second liens to refinance into a Federal Housing Administration loan. "While FHA will retain its standard rate and term refinance program for borrowers who are current on their existing mortgages, the FHA Secure program ... will terminate on Dec. 31, 2008," HUD says in a letter to FHA lenders. In a separate mortgagee letter, FHA updates its refinancing guidelines and said it will allow borrowers to re-subordinate second liens, which was an option provided under FHA Secure. FHA also has tightened its appraisal requirements on cash-out refinances where the loan-to-vale ratio is above 85%, according to Bud Carter, an FHA consultant with Potomac Partners. "FHA now requires two appraisals on cash-out refinancings above an 85% LTV, regardless of the amount of the loan," Mr. Carter said. Previously, FHA required two appraisals only if the loan amount was above $417,000.

Wednesday, December 24, 2008

FHA Mortgagee Ltr 2008-23: Revised Downpayment Requirements

Reminder about FHA Mortgagee Letter 2008-23 that has revised downpayment requirement as described throughout this mortgagee letter takes effect with all new FHA case number assignments on or after January 1, 2009.

September 5, 2008

MORTGAGEE LETTER 2008 - 23

TO: ALL APPROVED MORTGAGEES

SUBJECT: Revised Downpayment and Maximum Mortgage Requirements

The Housing and Economic Recovery Act of 2008 revised the National Housing Act to:

Require that the mortgagor “shall have paid, in cash or its equivalent…an amount equal to not less than 3.5 percent of the appraised value of the property….”;
Eliminate the variable loan-to-value limits that were based on the combination of the property value and the average closing costs of the State where the property is located (also known as “downpayment simplification”); and
Limit the total FHA-insured first mortgage to 100 percent of the appraised value, and require the inclusion of the upfront mortgage insurance premium (UFMIP) within that limit. This mortgagee letter provides guidance to mortgagees regarding the revised downpayment and maximum mortgage requirements for single family mortgage to be insured by FHA.

The entire Mortgagee Letter can be reviewed at http://portal.hud.gov/pls/portal/docs/PAGE/FHA_HOME/LENDERS/MORTGAGEE_LETTERS/2008_MORTGAGEE_LETTERS/08-23%20REVISED%20DOWNPAYMENT%20AND%20MAXIMUM%20MORTGAGE%20REQUIREMENTS_3.DOC