As you may have heard, it has now become a reality. The rumor we have been hearing about for months is now official for all FHA case numbers assigned AS OF APRIL 1, 2009
FHA Cashout refi's are limited to 85% across the board. The new mortgagee letter is ML 2009-08. They are saying this is temporary, but don't bet on it. Other notables within the letter:
1. CLTV's are limited to 85%
2. Loan mod's on seconds are not treated as NEW liens.
3. 12 month ownership seasoning requirement for cashout refi's for value vs. sales price
4. Current mortgage must be CURRENT, delinquent borrowers are ineligible.
5. Second appriasal still needed for cashout refi's in excess of $417,000 in a declining area.
6. Non-approved FHA brokers may not be compensated
7. Foreclosure properties are eligible for cashout to the 85% LTV maximum.
8. Non-occupying borrowers / co-signers may NOT ba added to the FHA insured mortgage.
Gerard Ladalardo, CMPS
www.caloanpros.com
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