I've been in this business for a while... my daughter would tell you I'm old as dirt... and for as long as I've been in this, we've had a complicated way of calculating FHA Downpayment.
FHA always used acquisition cost. How much were you putting into the total aquisition of the property... closing costs and downpayment combined.
With the new rule changes of January 1... we use a STRAIGHT UP number. The base loan will be a 96.5% of the sales price or appraised value - whichever is LESS. If you are working with a loan officer is is unfamiliar with FHA - you could find yourself at the closing table wishing you'd done a little more research. I just saw a deal where the loan officer quoted the wrong downpayment amount by $1200.
Do your research! Work with someone who KNOWS the guidelines!
Right on, right on, right on. Succiently put Eleanor.
It is so important for us in the mortgage world to know BUT it is important for us to make SURE the Realtors know
Good Post Eleanor, spot on with working with the experts in who knows their stuff!! It shows that you certainly do!
FHA will be a bigger part of my business in the future and I need to understand it thanks for the lesson.
There are alot of changes going into effect this week, I am we will see many mistakes by lo's in the days and months ahead, good job
Thanks so much for educating us about FHA. I would be clueless because I haven't had an FHA buyer lateley.