Less than 30 days into the new administration, Fannie Mae released information on their new change to roll back a very unpopular guideline change that occurred less than 12 months ago.
Information from the revision to the Selling Guide says" Fannie Mae is committed to providing financing opportunities for high-credit quality, bona fied investors. Experienced investors play a key role in the housing recovery and Fannie Mae's continued support for investor borrowers is consistent with its mission to provide stability, liquidity, and affordability to the nation's housing system".
On the onset of Spring, Investors will once again have the opportunity to own and finance up to 10 individual properties. The change is in effect on March 1, 2009 but it is important for Investors to be aware of the restrictions that are attached to this change:
Investors who are purchasing their 5th through 10th home will be required to meet the following minimum requirements: For a complete illustration of the changes, see Fannie Mae's Announcement 09-02.
Okay, here is a snapshot of the credit restrictions:
- 720 credit score
- 25% down payment for 1 unit properties and 30% for 2 to 4 unit properties
- Cannot have any late payment on a Mortgage in the past 12 months
- Will require 6 months of reserves for each property (Principal, Interest, Taxes and Insurance + any Association Dues, etc).
This is a good sign for Investors who can meet the above criteria - It would appear that Fannie Mae is seeing the light. There are experienced investors who meet the limitation, and can play a "key role" in housing recovery.
There is one more important point to make . . . Investors that had been stymied by the previous restrictions can now take advantage of the refinance opportunities that had limited them over the past 12 months.
Let's hope that this change will promote foreclosure liquidation which will provide support to the housing market as a whole. .
Gwenn Tanvas is a Certified Mortgage Planning Specialists who specializes in Government Programs such as FHA, State and Federal VA and USDA Rural Housing Loans. Visit her website for more information, on-line calculators and a secure on-line application. She is able to assist with transaction throughout the state of Wisconsin. Her offices are located in Appleton, Oshkosh and Green Bay and offers the convenience of one-stop shopping. http://www.WisconsinLoanTips.com or http://www.MortgageProsOfWisconsin.com she can also be reached for comment or to answer questions via email at firstname.lastname@example.org