Blog of the Mortgage

September 26th, 2008 8:24 AM
HUD has blessed us with the first of many new ML releases today as a result of HERA (Housing and Economic Recovery Act). This release: ML 08-23 addresses the timing of the increase of DownPayment for new purchases.
As you know the DownPayment will increase to 3.5% and will no longer include closing costs. The CLTV for new purchases is going to be limited to 100% unless the borrower is obtaining a downpayment assistance 2nd lien approved by HUD.

Some Details follow:
  • purchase money mortgages with new FHA case numbers assigned on or after January 1, 2009 must meet the revised downpayment requirements
  • Closing costs may not be used to help meet the minimum 3.5% downpayment requirement.
  • For purchase money mortgages, the LTV is 96.5 percent
  • When combined with the FHA first mortgage,
    government subordinate liens are not limited to 100 percent
  • Sellers are still permitted to provide financing concessions up to 6 percent of the sales price
  • Refinances are not subject to the 3.5 percent downpayment requirement since there is no "downpayment" on a refinance. The LTV will be calculated
  • Download the Complete Letter Here:
Posted by Raoul Badde on September 26th, 2008 8:24 AMPost a Comment (0)
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