Urgent Credit Policy Changes for Home Loans

Greetings,



Good morning,

Below summarizes the credit policy changes discussed in this morning branch meeting. Please let me know if you have any questions and thank you!



1) Expansion of Mortgage Insurance Allows 85.0% LTV in California- Effective 2/20/10

High Balance Conforming Loans for Purchase of Primary Residence with Fixed Rate eligible to 85% in California up to maximum to $729,750. NOTE: Maximum Debt-To-Income Ratio remains 41.0% for all LTV’s greater than 80.0%.



2) Expansion of Mortgage Insurance Allows 95.0% LTV in California- Effective 2/22/10

Conventional Conforming to $417,000 loan amounts. The minimum middle credit score must be:

Single Family 720

Condominium 740

NOTE: Maximum Debt-To-Income Ratio remains 41.0% for all LTV’s greater than 80.0%.



3) FHA Property Flipping Changes- Effective 2/01/10

At this time, Wells Fargo is only offering this enhancement for transactions with sales prices that do not exceed 20% of the amount the seller paid for the property . A property is eligible for FHA financing if Seller is owner-of-record 90 days or less if ALL requirements listed below are met. A policy is being considered for possible future implementation for greater then 20% sales prices.

The sales price cannot exceed 20% of the amount the seller paid for the property
The contract of sale for the purchase must be fully executed between 2/10/10 and 2/01/11
The transaction is arm’s length, with no interest between buyer and seller or other parties participating in the transaction.
Limited Liability Companies (LLC’s), Corporations or Trust serving as sellers were established and are operated in accordance with acceptable state and federal laws.
There is no pattern of previous flipping activity for the subject property as evidenced by multiple title transfers within 12 months.
The property was openly and fairly marketed (e.g. MLS, auction, FSBO)
Appraiser must:
Comment on any improvements to property made by sellers supported with photos
Acknowledge the increase in sales price from previous sale and provide specific commentary on support for increase in value
Provide a listing and sales history of subject property
The fully executed purchase contract can NOT be re-dated.
The buyer’s real estate agent can NOT be seller and can NOT be employed by, related to or affiliated with the seller.
10. Review and compare information with LoanSafe internal report.

Thank you,

Heather Millspaugh
Home Mortgage Consultant
heather.s.millspaugh@bankersfundingcompany.com
http://www.homeloans.com/wfhm/heather-millspaugh

Ken Webb - Realtor/Agent
OCAR, NAR, CAR
F1RST TEAM
Real Estate
Email: kenwebb@firstteam.com
Phone/Text: (949) 243-6649
DRE Lic # 01844181

SEARCH JUST LIKE AN AGENT
http://www.kwrealestate.listingbook.com

CURRENT REAL ESTATE NEWS
http://kenwebbkwrealestate.blogspot.com

UP TO THE MINUTE UPDATES ON TWITTER
http://twitter.com/KW_Real_Estate

STATE WIDE AND LOCAL REAL ESTATE FACTS & FIGURES
http://kenwebb.housingtrendsenewsletter.com/


"The finest compliment I could ever receive is a
referral from my friends and clients"