According to WSJ, Fannie and Freddie are making banks buy back poorly underwritten loans that have soured.
No wonder we have pre-closing audits, pre-funding audits, post-closing audits, post-post closing audits and so on and so forth. The documentation that borrowers must provide almost never ends at this point. Properly prepare borrowers for the onslaught of documentation requests. Banks don't want loans on their books when they could have sold it to Fan/ Fred.
Saturday, December 05, 2009
FHA Loosening Condo Approval Guidelines
Haven't posted in awhile. Business has been pretty good lately, despite all the whining I do on this blog.
FHA is changing some of their condo guidelines which should play well in the NYC market. First off, they are lowering the required pre-sales to 30% which will help many of the new developments offer FHA loans until they reach that magic 51-70% threshold needed for FNMA approval. Another nice thing is that they are willing to allow condos with a right of first refusal clause in their by-laws if it's shown that it's not used for discrimination. That will play well in NYC where almost all of the condos have this clause.
There are a few pull backs in the new guidelines as well, such as a 50% concentration limit, and the requirement that the condo be transferred into the hands of the Homeownwer's Association 12 months from the time of the first sale. This doesn't matter as much to existing condo buildings, but new development condos will hate it since they may not be finished with construction within that timeframe.
All in all, I say "thanks."
FHA is changing some of their condo guidelines which should play well in the NYC market. First off, they are lowering the required pre-sales to 30% which will help many of the new developments offer FHA loans until they reach that magic 51-70% threshold needed for FNMA approval. Another nice thing is that they are willing to allow condos with a right of first refusal clause in their by-laws if it's shown that it's not used for discrimination. That will play well in NYC where almost all of the condos have this clause.
There are a few pull backs in the new guidelines as well, such as a 50% concentration limit, and the requirement that the condo be transferred into the hands of the Homeownwer's Association 12 months from the time of the first sale. This doesn't matter as much to existing condo buildings, but new development condos will hate it since they may not be finished with construction within that timeframe.
All in all, I say "thanks."
Subscribe to:
Posts (Atom)