New FHA guidelines | TigerDroppings.com

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Im4datigers
LSU Fan
Northern Virginia
Member since Oct 2003
3074 posts

New FHA guidelines



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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ItNeverRains
LSU Fan
Franklin, TN
Member since Oct 2007
6362 posts

re: New FHA guidelines


Great question. My guess is its the govt so you need to be closed by 4/1/13





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LSUSUPERSTAR
LSU Fan
Arlington, TX
Member since Jan 2005
9710 posts
 Online 

re: New FHA guidelines


You can't do a conventional loan?





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jojothetireguy
New Orleans Saints Fan
Live out in Coconut Grove
Member since Jan 2009
9237 posts

re: New FHA guidelines


yes you need to have the case number before the April deadline.
Also can you go conventional?






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Im4datigers
LSU Fan
Northern Virginia
Member since Oct 2003
3074 posts

re: New FHA guidelines


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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LSU5508
LSU Fan
New Orleans
Member since Nov 2007
601 posts

re: New FHA guidelines


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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TheTigerZone
LSU Fan
Moss Bluff ,La
Member since Dec 2009
2343 posts

re: New FHA guidelines


quote:

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

Bingo.






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Im4datigers
LSU Fan
Northern Virginia
Member since Oct 2003
3074 posts

re: New FHA guidelines


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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MikeBRLA
LSU Fan
Baton Rouge
Member since Jun 2005
9262 posts

re: New FHA guidelines


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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JonTheTigerFan
LSU Fan
Central, LA
Member since Nov 2003
4729 posts

re: New FHA guidelines


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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