Price adjustments
Standard FHA loans with high balances up to $417,000 – price adjustment has been reduced to 1.75 pts. from 2.00 pts.
Product Changes
6076 – No longer available.
The following product changes become effective May 23, 2008:
6115 –
• Cash-out refinance
o 75/75% maximum LTV/CLTV for primary residences and second homes.
• Maximum cash-out for primary residences:
o $400,000 for LTV/CLTVs greater than 65/65%
o $500,000 for LTV/CLTVs less than or equal to 65/65%
• Maximum cash-out for second homes:
o $350,000 regardless of LTV/CLTV
• Maximum seller contributions
o 3% for LTV/CLTVs greater than 80/80%
• Second homes
o Borrower may not own a second home or investment property in the same geographic market as subject property.
• Required Reserves:
o Primary Residence –10% of the loan amount.
o Second Home—10% of the loan amount. If the borrower owns an investment property or more than one second home, reserves must equal 50% of the loan amount.
• Payoff of revolving debt to qualify will not be allowed.
• The maximum number of financed properties is four for all occupancy types regardless of property type or lender.
Exception: For transactions where the subject property is the primary residence, more than four financed properties will be allowed if reserves are $1 million or 50% of the loan amount (whichever is greater).
• No bankruptcy or foreclosure in last seven years.
6138 and 6140 –
• These terms will no longer be available:
o Cash-out refinance on investment properties.
o Cash-out refinance on second homes.
o 3-4 unit properties.