The information below was obtained by a loan officer with Countrywide Bank FSB. It is a list of the major changes that they are making on Conventional Loans both conforming and non-conforming in the Central Ohio Area. The source was unable to say whether or not Countrywide will be implementing these new guidelines throughout all their service areas but since our market has been tagged as "restricted" and or "soft" these changes will go into effect for all loans locked after March 19th, 2009
1) Minimum credit scores now with loans over 80% loan to value will be 700 and no longer 620
2) 2nd homes will now require 20% down on conforming loans
3) Debt Ratio's - MAXIMUM is 41% for loans over 80%, regardless of Automated Underwriting system and MI companies will NOT insure them so they have to be at 41% even or below
4) Reserves - minimum 2 months of reserves are now required and can be more based on the Automated Underwriting System
5) Cash out refinances - MAXIMUM is 80% cash out and loans that were done originally as 80-15-5 or 80-10-10 where the borrower wants to refinance both loans into 1, that is considered 'CASH OUT' and maximum is 80% loan to value
6) CONDO'S - MINIMUM 15% DOWN WITH SCORES OVER 700 & CONDO HAS TO BE FNMA ELIGIBLE
7) Interest Only Loans- Maximum financing is 80%
For awhile treated like the ugly duckling this is going to make FHA EVEN MORE ATTRACTIVE AND ELIGIBLE FOR BORROWERS OVER 80% LTV WITH SCORES UNDER 700..
It will be interesting to keep watch to see if others follow suit with Countrywide..
For more information on Central Ohio Market Conditions see: Should I Stay or Should I GO?
If you are looking to purchase or sell a home in the Central Ohio Area please give me a call at 614-273-6406 or email me at Vanessa.email@example.com