New FHA Changes

Here is some information Leonard Winslow, a Mortgage Officer got together for me on the new FHA changes:

A couple of important changes to FHA mortgage financing went into place
yesterday.

1.Maximum Seller Concession = 3% (was 6%)

2.UPFRONT MIP now 2.25 (was 1.75%)- (upfront mortgage insurance added to the
loan)

The down payment requirement is still the same at 3.5%. We have often
written contracts lately getting 3.5% to 4.5% in closing costs from the
seller to pay closing and to buy down the borrower's rate by paying points.
Today 3% will still cover closing costs and pre-paid taxes and insurance, we
just won't have enough to have the seller buy down the interest rate for the
purchaser. We will be looking at 0 point loans and in some cases lender
credit's to close. Remember I can pay some closing costs, I just have to
charge a slightly higher interest rate to do that.

Leonard Winslow, Branch Manager/Mortgage Officer

New American Mortgage

2017 West Main Street

Waynesboro, Va. 22980

Office: 434-296-7900

Direct: 434-760-2580

Efax: 540-904-0025

http://www.newamerican.com/leonard.winslow