100% financing is back AND we have a new 2nd Chance program for people who have had a recent foreclosure or short-sale. We have set aside $30,000,000 to fund these programs. They are available in Nevada only.
Borrowers with a credit score of 720 or higher can qualify for 100% financing if they have income that will allow their debt ratio to be at 45% or below. Basic FNMA / FHLMC guidelines apply to this manually underwritten loan. The first is fixed at 5.5% and the 2nd is a 30/15 at 9%. The blended rate is 6.2%. This is a great FHA alternative for borrowers with little money for a down payment (closing costs are a bit higher than for FHA loans). The other benefit is that the payment may be lower than an FHA loan since there is no mortgage insurance.
Borrowers with a foreclosure or short sale may benefit from teh 2nd Chance program which allows financing for borrowers just 1 year out of a foreclosure (minimum credit score of 620, 580 on a case-by-case exception). The program will consider buyers who short-sold a house just three months ago. FHA's guideline is 3 years!! There is a 20% down payment requirement of which 15% can be gifted. This loan is for buyers who have good credit other than their foreclosure or short-sale. It will also consider buyers one year out of bankruptcy. The rate is fixed for 30 years at 5.5%.
We are also having great success with our FHA 203(k) Streamline program for which we have a dedicated general contractor. He just finished a home for us on Monday and it looked and smelled like a brand new home and the home owner was happy as could be. The work was done in 20 business days (new paint in every room, new lighting fixtures, refinished cabinets throughout the house, new granite countertops in the kitchen, new tile flooring in the kitchen, bathrooms, and family room, and new countertops in the bathroom along with new bath and shower surrounds). Can you imagine the referrals we'll get from this extremely happy borrower? To think that we closed this FHA 203(k) Streamline 9 days early!!
What are your thoughts on these new programs and the FHA 203(k) Streamline?