Big Mortgage Changes ahead! Read below! There are two very important changes on the horizon that will affect your buyers purchasing power. 1. Fannie Mae is dropping its 97% LTV product November 16th, increasing their minimum down payment to 5%. This will drive higher credit profiles to FHA. FHA funding fees and increased Mortgage insurance, possible side effects of a lowered purchase price limit. Its more important than ever to pre-qual before they start looking, perhaps positioning them for conventional purchasing. Conventional financing; If their credit score is close to better pricing class selection, we can work on their credit score to get the best pricing on Mortgage insurance for convention financing. Example; recent buyer was just a few points away for better pricing, suggested changes on his credit report, 30 days later new credit and his Mortgage insurance premium went from $212.09 down to $151.17 a month. 2. January 2014 law changes, > 975 pages of new lending laws coming our way, part of QM Qualified Mortgage The biggest change is Debt to Income will be capped at 43% ! This new qualified mortgage law, lenders will be very concerned coming even close to this debt to income limit ( not being able to sell these loans). How does this affect your buyers; First they will qualify for less house in addition we anticipate rates to rise( the low rates of Spring will not be on the horizon) While this will be an opportunity for non Fannie Mae lenders to form (offering new loan products) anticipate higher interest rates on these loan products. 3. The USDA ( Rural housing) location restrictions have been extended to January 15th. This is a huge gift for all buyers but especially buyers selling their starter home, walking away with ZERO equity money. Purchase your step up house with no money down with seller paid closing cost. Example; closed a buyer with $285,000 purchase price in Big Lake. Family of 1-4 in Sherburne County can make up to $93,450, family size of 5-8 $123,350 (after subtracting day care) annual gross income. Rural housing is not just for first time home buyers.
Posted on: Mon, 28 Oct 2013 15:46:35 +0000
Trending Topics
Recently Viewed Topics
© 2015