I am a positive, solution oriented and experienced Loan Officer. So along with this not so positive changes, I have added my solutions. Expect major banks to begin to adopt the new Fannie Mae regs before June 1st. The cliff notes version is the following:
1) Minimum FICO - regardless of LTV is 580. What this means is that if a borrower is putting down 50% and has a 579 score, it won't give the 'Approve/Eligible' DU decision.
Solution: Go FHA
2) Foreclosures - current guideline reads that a borrower must be 4 years past a foreclosure. This will change to 5 years. Plus, after the 5 years, the borrower must have a 680 middle FICO and put 10% down.
Solution: Go FHA
3) MCM - My Community Loans MAX LTV will reduce to 97% and min credit score will increase.
4) Regular Conventional Max LTV will reduce to 95% and min credit score will increase
5) Investment Property min credit score increases to 680 for 90%LTV. (Hope you can get MI on that loan)
Solution: Investors must put 20% down.
For all you Realtors and Brokers out there... Now is the time to bring an experienced Loan Officer into one of your sales meetings and explain in plain and easy terms how you need to navigate these rough waters ahead. We are all in this together.
For detailed changes, I recommend that ya'll go to the following web sites:
www.efanniemae.com
www.ugcorp.com
www.mgic.com
That's a good start.
;)
;)
