New FHA guidelines
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New FHA guidelines
Posted by Im4datigers on 2/13 at 8:41 am
quick question - buying a house, can't close until mid-june because it's being built.

If I go FHA, do I just need to have a case number originated before the new guidelines kick in (which supposedly my mortgage broker can obtain now)? Or do I have to actually close before the new guidelines kick in?

Primarily the no right to ever cancel PMI deal.

getting mixed answers out in the market. Thanks!



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Posted by ItNeverRains on 2/13 at 10:23 am to Im4datigers
Great question. My guess is its the govt so you need to be closed by 4/1/13


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Posted by LSUSUPERSTAR on 2/13 at 12:25 pm to Im4datigers
You can't do a conventional loan?


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Posted by jojothetireguy on 2/13 at 12:55 pm to Im4datigers
yes you need to have the case number before the April deadline.
Also can you go conventional?



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Posted by Im4datigers on 2/13 at 1:38 pm to jojothetireguy
I could do conventional, but I'd have to do either 10% down or do 75/20/5. Been told I can't do a 95% LTV on a condo unit (primary residence).

I've run the numbers both ways and I think I'd rather have the extra $7200 in my pocked right now for emergencies. That's the downpayment difference between 3.5% and 5% down.

Plus the second mortgage is going to be in the neighborhood of 7% so I'd want to refinance that along with the first within 4 or 5 year anyway.

I think I'd rather lock in the FHA rate for 30 years and just chunk down principal to get to 78% LTV after the 5 year min period. This way I don't have to worry about refinancing if I don't want to and have to worry about rates rising.

It's basically pay now or pay later I guess.



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Posted by LSU5508 on 2/13 at 3:43 pm to Im4datigers
Just a random question. I had always been told you needed atleast 20% down to do a construction loan, how did you go about building with as little as 5% down. I had the urge to build a few months back but decided to wait until i had 20%. I would love to build with todays rates but am curious of the process with FHA and construction loans.


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Posted by TheTigerZone on 2/13 at 3:58 pm to LSU5508
quote:

yes you need to have the case number before the April deadline.

Bingo.



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Posted by Im4datigers on 2/13 at 3:58 pm to LSU5508
Should have qualified that statement.....builder is building the home/townhome. He has the construction loan, not me. I will be the end user once it's completed thus qualifying for the FHA route if I choose.

And yes, you are correct in that you do need 20% down to do a construction loan where you finance it yourself.

My words of wisdom is if you find a lot where you want to build, approach a builder to do the deal with. Let him purchase the lot and obtain the construction loan through his financing power with his bank and simultaneously sign a purchase agreement with him with a nice size deposit (negotiable). He'll add his builder's profit into the cost, but then you'll be able to walk in and utilize FHA financing at the end of construction since you will be buying the completed home from him.

Hope that makes sense.



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Posted by MikeBRLA on 2/14 at 7:28 am to LSU5508
quote:

Just a random question. I had always been told you needed atleast 20% down to do a construction loan, how did you go about building with as little as 5% down. I had the urge to build a few months back but decided to wait until i had 20%. I would love to build with todays rates but am curious of the process with FHA and construction loans.


You could get your builder to do a "turn key" build for you. Basically the builder buys the lot of your choice and builds your custom house on it. Then he sells you the whole thing. No construction loan needed since your builder owns the property while it's being built.



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Posted by JonTheTigerFan on 2/14 at 7:54 am to MikeBRLA
quote:

You could get your builder to do a "turn key" build for you. Basically the builder buys the lot of your choice and builds your custom house on it. Then he sells you the whole thing. No construction loan needed since your builder owns the property while it's being built.


This. And if you own a lot already, I believe the builder can buy it from you and still do the turnkey deal.

To answer the OP, you just need to have a case number before the deadline. You can close after that date and be grandfathered in.



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