Just when you thought you understood the FHA condo financing guidelines, HUD steps in and changes things all over again. And, there’s both good news and bad news for buyers, sellers, investors and developers alike in the latest revisions. The new rules – which HUD says are temporary – are set to begin on December 7th and run through the end of 2010.

Here’s a summary of the major changes to the guidelines:

• HUD amended the previously controversial requirement that at least 50% of the units in a project must be sold before FHA could insure loans for new buyers on individual units. Under the new rule, FHA financing will now be available in projects where at least 30% of the existing units have been sold.

Continue Reading Revised FHA Condo Rules – HUD Relaxes Some Guidelines, Tightens Others

Tags: FHA, HUD, mortgages

Both the Senate and House voted yesterday to extend the current higher loan limits for Fannie Mae, Freddie Mac and FHA loans through December, 2010. The resolution was attached to a continuing resolution that passed late in the day and prevented the higher limits from expiring at the end of the year.

Lawmakers had temporarily raised the loan limits back in 2008 as part of the Housing and Economic Act of 2008 and then again in 2009 through both a HUD mandated guideline and the Economic Stimulus Act up to a maximum of $729,750 for high-cost areas.

To find your individual counties higher loan limits, you can read our blog post at 2009 FHA and Conforming Loan Limit Changes.

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Continue Reading Congress Extends Higher Loan Limits Through 2010

Tags: FHA, HUD, legislature, mortgages

The Federal Housing Administration (FHA) announced yesterday they are adopting a new Cash for Keys program whereby lenders will pay borrowers with FHA-backed loans $2,000 for agreeing to turn their property over to the lender by using a deed-in-lieu of foreclosure. By applying for and getting an approved deed-in-lieu under this program, borrowers will be released from their obligation to repay the mortgage and may also have their deficiency judgment waived too.

To qualify for the program, borrowers must be facing long-term financial hardship, had their house on the market at a fair price for at least 90 days, and not have any other additional claims or liens (other than the first FHA mortgage) outstanding against the house. In addition, the borrower must vacate the property and leave it in broom clean condition.

Continue Reading FHA to Pay $2,000 for Cash for Keys Program

Tags: FHA, foreclosures, HUD, mortgages

We wrote a blog post a while back about how if you are purchasing a condo in Florida, mortgage financing is tougher than ever before. Well, it just got even harder to get condo financing, thanks to a new rule set to take effect on November 1, 2009.

The new rule will put an end to “spot approvals” for condo complexes and thus make it harder for buyers to qualify for these types of property loans. The rule disallows FHA underwriter’s ability to approve individual condo units rather than an entire condo complex. The reason spot approvals were originally granted was because of the costs and paperwork involved for a condominium association to get an entire complex approved by the FHA is outrageous, costing tens of thousands of dollars for things like appraisals, structural engineering reports, audited financial reports etc. Spot approvals only required a condo or HOA representative to spend about 15 minutes filling out a one page questionaire.

Continue Reading New FHA Rule Regarding Condominium Financing

Tags: FHA, Florida, HUD, mortgages

The FHA 203(k) Rehabilitation Loan program may be right up your alley if you are buying a foreclosure as your primary residence. That’s because The Federal Housing Administration (FHA) is encouraging the use of its little known 203(k) loan which allows a primary owner-occupant* to borrow money for both the purchase and renovation of a property all in one loan. And, you only have to have 3.5% of the total purchase price (acquisition and repair costs) as the down payment. In addition, the program can be use to include cosmetic improvements as well as major renovations like replacing a roof or fixing up the properties plumbing or electrical systems.

Continue Reading Foreclosure Purchases and the FHA 203(k) Rehabilitation Loan Program

Tags: FHA, foreclosures, mortgages