LOW DOWN PAYMENT
Fannie Mae and Freddie Mac will start backing mortgages with down payments of as little as 3% of purchase price in an effort to open up lending to low-income and first time home buyers. These will be fixed rate loans for purchase and refinance.
There are some hurdles to get over in order to qualify:
1 - Must have private mortgage insurance
2 - Must have credit score of at least 620
3 - complete documentation of income, assets and job status
4 - must receive homeownership counseling
These will be available December 13th from Fannie Mae and March 23, 2015 from Freddie Mac
USDA UNDERWRITING CHANGES
1 - At least one borrower whose income and assets are used for qualification must have at least 3 historical trade line payment references that have existed for at least 12 months to establish a credit reputation and validated credit score.
2 - Parameters to retain one additional residence has been defined
3 - Significant guidance on collection accounts
4 - Number of months remaining for installment debt is being revised from 6 months remaining to 10 months.
5 - Guidance added for student loan payments.
6 - Credit documents, including properties that are new constructions will have a 120 day validity period.
7 - Appraisal validity period being reduced from 180 days to 120 days. Update policy revised to allow one 30 day extension.
8 - Properties with in-ground pools are eligible.
9 - Clarification for when minimal income producing activity is an eligible property type characteristic.
10 - Eliminates deductions for contributory value of functional farm service buildings.
11 - 30% site value requirement will no longer apply
12 - Flood Insurance requirements will be defined and align with NFIP.
As always - consult a professional, reputable Mortgage representative with questions, further detail and explanations.
We highly recommend:
RiverWood Financial Group
Mike Miller
317-558-7719
mmiller@riverwoodfg.com
#Mortgage Update - 3% down and #USDA
This is a good news because i wouldn't know the about 3% low down payment which is very essential for me for next update.
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