As we come to the end of a wild and crazy year full of change in real estate, we wanted to remind you of Changes to FHA Loans that will be taking place soon.
Required Down Payment Increases to 3.5%
Effective 1/1/09. *Remember- the down payment may come from borrower’s own funds or from family member’s gift and the seller may pay buyer’s closing costs, not to exceed 6% of the purchase price.
Minimum Required Credit Score 580
This was recently announced and now matches Fannie Mae and Freddie Mac’s minimum credit score requirement. The effective date will vary from lender to lender as HUD is requiring that all loans delivered to them by March 2009 meet this criterion- lenders will likely mandate the 580 minimum in advance of that date so that the loan funds and is shipped to HUD prior to the cut off. *Remember- manually underwritten loans with nontraditional credit will be exempt from this policy.
