If you’re in want of a cash out refinance, the most liberal cash-out program in town is about to make qualification more difficult.
Effective April 1, 2009, the FHA is reducing the maximum loan-to-value on cash-out refinance by 10 percent, dropping the loan size limit from 95% of the homes value to 85%.
In its official press release, the FHA days it’s making the change to “limit its exposure to undue risk”.
It also lists the following cash-out requirements:
- With less than 12 months since the purchase date, a homes value cannot exceed its original purchase price — even if home improvements were made.
- A homeowner must be current on his mortgage payments to qualify
- A second, verifying appraisal may be necessary, depending on loan traits
- Co-signers may not be added to the mortgage note in order to qualify
The last day to register a FHA 95% cash out refinance is Tuesday, March 31, 2009. The loan does not need to be “locked” — only registered.
So, if you know that a 95% cash out FHA refinance is in your future, talk to your loan officer before Wednesday morning about registration.
If you have any questions or concerns about possibly refinancing your North Georgia Mountain Home or Cabin, please give me a call at 706.633.8186 or Contact Me so that I can refer you to one of my team members and associates, a Professional Mortgage Broker.
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