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regineia
327 Posts |
 Posted - 05/20/2008 : 10:11:23 AM
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Is it true?
Fannie Mae just announced a withdrawal of their declining market policy! To quote from Announcement 08-10, “Lenders are no longer required to make a downward adjustment to the LTV, CLTV, or home equity CLTV (HCLTV) based on the location of the property.” Yes, you are reading correctly; no more 5% declining market reduction, at least for Fannie Mae loans! But hold on, let’s not get too excited yet. I’ll explain in a second, but let me give you a brief summary of the Announcement first. Per Fannie Mae Announcement 08-10, dated May 16, 2008:
Fannie Mae withdraws their declining market policy effective 6-1-08;
Declining market policy is replaced by a “National Down Payment’ policy which reduces maximum allowable LTVs for 1-unit primary residences;
95% is the maximum LTV, CLTV, HCLTV for manually underwritten loans;
97% is the maximum LTV, CLTV, HCLTV for DU underwritten loans, including MyCommunityMortgages® and Flex mortgages;
CLTV of 105% with Community Seconds® is still allowed;
Effective date is for applications taken on or after June 1, 2008.
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egamarro
79 Posts |
Posted - 05/20/2008 : 10:14:46 AM
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quote:
Originally posted by regineia
Is it true?
Fannie Mae just announced a withdrawal of their declining market policy! To quote from Announcement 08-10, “Lenders are no longer required to make a downward adjustment to the LTV, CLTV, or home equity CLTV (HCLTV) based on the location of the property.” Yes, you are reading correctly; no more 5% declining market reduction, at least for Fannie Mae loans! But hold on, let’s not get too excited yet. I’ll explain in a second, but let me give you a brief summary of the Announcement first. Per Fannie Mae Announcement 08-10, dated May 16, 2008:
Fannie Mae withdraws their declining market policy effective 6-1-08;
Declining market policy is replaced by a “National Down Payment’ policy which reduces maximum allowable LTVs for 1-unit primary residences;
95% is the maximum LTV, CLTV, HCLTV for manually underwritten loans;
97% is the maximum LTV, CLTV, HCLTV for DU underwritten loans, including MyCommunityMortgages® and Flex mortgages;
CLTV of 105% with Community Seconds® is still allowed;
Effective date is for applications taken on or after June 1, 2008.
Freddie is doing similar
From the truth about mortgage . com yesterday:
Elimination of Freddie Mac's Declining Market Policy
Freddie Mac is committed to protecting borrowers in these challenging times and providing you with clarity of our loan purchase requirements. This includes our declining markets policy, which was intended to aid borrowers, lenders, and the industry in the current environment. However, through your feedback we understand the implementation of industry declining markets policies have created confusion. As a result, today Freddie Mac is announcing we are eliminating our declining markets policy.
Instead, we are providing a simplified way to address maximum financing in this market. Beginning June 1, 2008, we will allow maximum financing up to 95 percent loan-to-value (LTV) for most Freddie Mac mortgages in all markets; this applies to mortgages that are underwritten manually or through Loan Prospector®. Maximum financing requirements may vary depending on occupancy type, number of units, and transaction type.
For low-and moderate-income borrowers and borrowers in underserved areas, we will continue to provide 100 percent financing through our Home Possible® mortgages while positioning first-time homebuyers for long-term successful homeownership.
Although we are eliminating this policy, we continue to strongly maintain that it is still vital that borrowers, lenders, and investors are aware of market conditions and trends, and the importance appraisals play in the lending process. Our appraisal standards for mortgages originated in these markets will remain the same. We continue to monitor the market and maintain our dialogue with consumer and industry trade groups, and our customers to ensure our policies and guidelines meet the needs of current market challenges.
We will announce new requirements and effective dates in an upcoming Single-Family Seller/Servicer Guide Bulletin. We are sharing this information with you today because it is important to your business and your borrowers. Until we provide more detailed information regarding our new requirements, existing requirements apply.
Contact your Freddie Mac Account Manager or representative if you have any questions about our current maximum financing requirements for properties in declining markets
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regineia
327 Posts |
Posted - 05/20/2008 : 10:23:24 AM
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| How strong it can be to change the market now? |
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lucky1s
3339 Posts |
Posted - 05/20/2008 : 10:41:35 AM
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So in other words, they are eliminating 100% excepot for Community products.
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regineia
327 Posts |
Posted - 05/20/2008 : 10:46:37 AM
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| We don't have 100% in Florida. |
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williamspeaking
4043 Posts |
Posted - 05/20/2008 : 11:01:49 AM
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quote:
Originally posted by lucky1s
So in other words, they are eliminating 100% excepot for Community products.
100% hasnt been happening for a while..there hasnt been MI available. |
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regineia
327 Posts |
Posted - 05/20/2008 : 11:06:26 AM
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| Any lender can do 95% in Florida? |
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LO1003
70 Posts |
Posted - 05/20/2008 : 11:25:17 AM
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| Won't matter because mi companies will dictate ltv. |
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South Shore
257 Posts |
Posted - 05/20/2008 : 11:31:43 AM
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FHA guidelines provide for 95% on cashout refinances. Purchases are up to 97% LTV w/ up to a 6% seller's concession and the borrower's contribution can be a gift or DPAP.
No declining market reductions either!
Our Company (est. 1987) has a well established Affiliate Program for non-FHA approved Brokers where you can assist your existing client with FHA product.
Our focus is to work hard to close your clients loans and to build a long term relationship with your company. You are recognized as the Broker, can make up to 2% Broker Fee, payable right on HUD; no ysp.
Also keep in mind that most of your EA-I, EA-II and EA-III scenarios would be much better closing with FHA product as FHA rates and monthly MI are MUCH lower! HUD has also raised their loan limits and we can now save even more of your deals that will not work conforming but will FHA!
I am directly available to discuss our Program and your scenarios for properties in FL, MD, DE, NY, CT, MA, ME, IL, MN, AZ, and CO.
Have a scenario? FAX or e-mail me your 1003 and credit for same day review.
Neely Mondello; DE
South Shore Mortgage
866-237-7452 x242
FAX: 631-574-1442
neelymondello@myfastmortgage.com
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MBG
211 Posts |
Posted - 05/20/2008 : 1:40:42 PM
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I couldn't find anything on fanniemae.com. Haven't checked freddie, yet.
But, now it is up to the MI cos......and, clients' credit scores, of course.
Would be very positive news to report to my contacts that this has been lifted at the gov't level, though!
Cheers~~~~~~~~ |
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cblaskoski
467 Posts |
Posted - 05/20/2008 : 2:08:32 PM
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| it would be great if we could keep this post updated over the next few weeks. Does anyone have proof of this? I've talked to a few reps and they have not heard of it yet. |
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kalee3415
190 Posts |
Posted - 05/20/2008 : 2:33:59 PM
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Here it is (copy & paste):
www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2008/0810.pdf
According to our MGIC rep MI is fine with 95% in a declining market. This is only effective for apps taken after June 1st
[/url][/url]quote:
Originally posted by cblaskoski
it would be great if we could keep this post updated over the next few weeks. Does anyone have proof of this? I've talked to a few reps and they have not heard of it yet.
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Shuggins
928 Posts |
Posted - 05/20/2008 : 2:34:39 PM
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| I've been speaking with my MI reps today about this. They say they will not be changing anything anytime soon. |
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LO1003
70 Posts |
Posted - 05/20/2008 : 2:39:20 PM
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| My rep told me about it today (not a big lender). However, he said MI companies will have to follow suit to have any effect. I didn't know MI companies had same declining value policy, but I guess they do. Both GSE's and MI companies have usually always mirrored each other's guidelines (usually, that is). |
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regineia
327 Posts |
Posted - 05/20/2008 : 5:09:22 PM
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| So, nothing will get better... If MI Companies doesn't help, we cannot go anywhere. |
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Travis Du Bois
588 Posts |
Posted - 05/20/2008 : 6:23:01 PM
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go no MI
http://www.brokeroutpost.com/loans/brokers/forum/topic.asp?TOPIC_ID=222087
Or split in to a 1st and 2nd
http://www.brokeroutpost.com/loans/brokers/forum/topic.asp?TOPIC_ID=204186
Call or e-mail me for more details.
Thanks
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bobabrahamson
84 Posts |
Posted - 05/20/2008 : 6:30:15 PM
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| I work for a lender and we have been getting some changes to various programs over the last few weeks but no blanket change. I will pass along any major change as soon as we are told. |
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regineia
327 Posts |
Posted - 05/20/2008 : 6:32:57 PM
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| Please, keep us informed ! |
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regineia
327 Posts |
Posted - 05/21/2008 : 08:52:11 AM
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| If has no MI for 95%, Why they change the declining policy? Doesn't matter...Will not make any diference for us, we cannot close files with 95% LTV without MI. |
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cblaskoski
467 Posts |
Posted - 05/21/2008 : 10:27:21 AM
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| doesn't radian go to 95%? What about combos? Does the change in declining mkt restrictions also apply to non-owners? This is a good thread we should keep the questions flowing. This could revive a lot of dead deals. |
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Travis Du Bois
588 Posts |
Posted - 05/21/2008 : 10:44:58 AM
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quote:
Originally posted by regineia
If has no MI for 95%, Why they change the declining policy? Doesn't matter...Will not make any diference for us, we cannot close files with 95% LTV without MI.
You can get to 95%LTV with no MI on my MI Buster product. So review the link above and if your borrower looks like they qualify give me a call or e-mail me. Lets make it happen!
Thakns
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kalee3415
190 Posts |
Posted - 05/21/2008 : 10:50:53 AM
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I am not sure what all the questions and confusion is. I posted a link for Fannie Mae's new guidelines effective June 1st above. As I also said, MI (at least through MGIC, haven't checked the others but they are all following each other) is fine with 95% in a declining market. So 95% in a declining market WILL be fine for apps taken after June 1st.
Once again here is the fannie guideline:
www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2008/0810.pdf
Here is MGIC's:
http://www.mgic.com/pdfs/71-42759_Restricted.pdf
****Update**** this link will take you to MGIC but show an error. Click the guides tab, then restricted market info on the right. You can get the guidelines there.
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regineia
327 Posts |
Posted - 05/21/2008 : 3:57:50 PM
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| So we are going to start 95% again after june first? I heard wells fargo does it now. Is it true? Anybody has Wells fargo's A.E. info . I want to contact them to more details. |
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kalee3415
190 Posts |
Posted - 05/21/2008 : 4:09:58 PM
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Okay, so Freddie & Fannie have both (as seen in this post) released that it will be effective June 1st. With that being said, I don't see how Wells could be able to until then.
quote:
Originally posted by regineia
So we are going to start 95% again after june first? I heard wells fargo does it now. Is it true? Anybody has Wells fargo's A.E. info . I want to contact them to more details.
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bobabrahamson
84 Posts |
Posted - 05/21/2008 : 6:47:14 PM
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| As I said earlier, I work for a lender. I have repeatedly read how FHA will be making their guidelines more lenient. I have also been getting bits and pieces from my employer about declining market adjustments going away. The fact is that the guidelines are getting more strict and the declining market changes basically went away today. There are all kinds of requirements that need to be met in order to waive the additional 5%. Maybe it is just my employer. I really hope so. |
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