Fannie Mae is rolling out new lending guidelines Tuesday, September 1, 2009.
Being approved for a home loan could be much more difficult. The new rules mark the first major underwriting update since April of this year. The changes are mostly geared at fraud prevention.
Among the updates:
- Stock options are no longer eligible for “reserves”
- Relocating families can’t use the “trailing” spouse’s projected income
- “Tip” income must be documented and verified
- Lenders must call employers to verify employment
- Lenders must verify tax transcripts against IRS records
But there are other changes, too. As examples:
- Owners and buyers of 2-unit homes are subject to new minimum FICOs with larger downpayment and equity requirements.
- Only 70% of stock, bond and mutual values may be used as reserves
- Only 60% of retirement assets may be used as reserves
Not everyone that qualifies for a mortgage on
Monday, August 31 will qualify on Tuesday, September 1.
Read the complete Fannie Mae announcement online.
Please call me with any questions 813 784 7744
In a move that will make it even more difficult to qualify for a condo loan, Fannie Mae is putting a host of new conditions on mortgages for condominiums.
- View from 345 Bayshore Condo
Lending giant Fannie Mae is slapping tough new requirements
Fannie Mae’s timing ”couldn’t be worse,” said Jack McCabe, a South Florida real estate consultant who believes the region is mired in a housing depression. “This is effectively going to make it much more difficult to qualify.”
NEEDED TO QUALIFY
The new conditions include:
• No more than 15 percent of unit owners can be 30 days or more past due on association fees.
• For new condo buildings and condo conversions, at least 70 percent of units must have been sold or put under contract. That’s up from 49 percent previously.
Charles Foschini, vice chairman of debt and equity finance for brokerage CB Richard Ellis in Miami, said Fannie was protecting investors, borrowers and taxpayers, as it should in a climate of increased risk.
Borrowers will benefit, he said, by knowing they are moving into a condo complex that is adequately funded and has plenty of reserves, allowing them to predict their monthly expenses.
”From the taxpayer’s perspective . . . the quicker we can instill sounder underwriting practices for mortgages for Fannie or anyone else the more confidence we’ll have in the market,” Foschini said.
If you are looking to buy a condo in the Tampa Bay area and would like a list of approved condos, please send us an email with your request: info@thetamparealestateinsider.com subject: approved condo list.
Our phone number is 813 784 7744 should you have any questions.
Rae Catanese, PA
Real Estate Agent -Prudential Tropical Realty-Tampa,FL
Federal Reserve Board Slashes Fed Funds Rate
On December 16, 2008, the Federal Reserve slashed the target range for the federal funds rate to 0%-0.25%–a clear signal that Chairman Bernanke and other members of the Board will take all necessary steps to achieve economic recovery.
The press release announced that, in addition to the existing commitment by the Federal Reserve to purchase up to $500 billion of Fannie Mae and Freddie Mac mortgage backed securities and $100 billion of their debt obligations, the Fed will expand these purchase programs “as conditions warrant.” The Fed clearly understands that the key to economic recovery is restoring health to and confidence in the housing and mortgage markets.
Federal Reserve Press Release
Commentary by NAR’s Chief Economist Lawrence Yun
