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New FHA Realities

New FHA Guidelines as of April 5, 2010

I’ve had a few inquiries late for FHA financing because of low down payments, still 3.5% as of now.  Starting April 5th, things are changing.  New FHA Guidelines:

  • FHA increases its upfront mortgage insurance premiums to 2.25%, raises its minimum FICO score requirements to 620, and reduces its allowable seller concessions to 3 percent. (use to be 6%)
  •  A 620 FICO score will still get you a 3.5% down payment, if score is lower it will be 10% down.

On sellers concession (participate in closing costs) you used to be able to bump sales price up a bit to cover but really need to watch this now with stricter appraisal issues.  The point being is – it’s less expensive now to do an FHA than waiting till April 5th.  Right now a 580 FICO score can still get you a 3.5% down payment but it doesn’t mean the bank will approve it, I would say the higher your FICO score the more likely you’ll get what you want….Ahhh they always try to be in control!

The reality is FHA fees are going to be higher after April 5th.  Make sure you talk to a lender about qualifying and to explain all your options.  There are still good programs out there but they seem to be changing quickly.  Anyone involved in a real estate transaction needs to plan accordingly.  Check outDan Green’s mortgage report for more info.

About Terry Smith

Passionate about real estate, positive problem solver, specialty boutique real estate brokerage that does things your way! A full-time Broker & REALTOR®, helping people buy and sell homes in the Dallas - Plano area. Whether you're a buyer just starting out or someone with luxury properties to sell. I have extensive knowledge and experience to help you with your real estate transaction. I am a native Dallasite. Have questions? Ask me. You can find me on Google+ and Pinterest.

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