Wednesday, April 16, 2008

New Stimulus Size loans FHA or Fannie?

Well, The new Stimulus Package loan limits are here, and we have had a couple weeks to see how the banks would digest the new loan limits. For instance, the new loan limit in Los Angeles, CA is $729,750, while the limit for San Diego, CA is $697,500. The Seattle area in Washington, including King, Pierce & Snohomish Counties are now capped at $567,500.

So what is the difference between the larger FHA loans and Fannie Mae's new Jumbo offerings.

Well for starters, FHA only requires 3% down payment vs Fannie Mae's 5% minimum. There is another advantage to using FHA when the property is in a "declining market" such as most of California, Florida, or Michigan. In the Declining Market, Fannie Mae requires another 5% down for a total of 10% down payment required. Regardless of credit score. This is the minimum.

FHA guidelines are far more predictable than Fannie Mae's are right now due to problems for Banks to sell loans in the secondary market. These problems have resulted in constant changes in qualification guidelines & parameters for Fannie Mae loans. Meanwhile, FHA loans remain true to form, since they are guaranteed by HUD, paid for by the Mortgage Insurance on each loan, these have not had to change as dramatically to keep up with the secondary marketability and the all mighty bank liquidity requirements. (IE, bad loans on the banks books hurt liquidity since they can't sell them for what they paid for them or their original value).

Stay Tuned for more FHA updates in the days to come.

Wednesday, April 2, 2008

FHA Jumbo loans are finally here

They are now here. FHA Jumbo loans. The new stimulus bill allows FHA loans up to $729,750 in the highest cost markets. Even if you are not in one of these markets, your loan limits have increased. Click here to access the limits for your area. (pdf will take a moment to load).

The FHA jumbo loan is fast becoming our most popular loan with the wider range of qualifying rules, (lower fico's, credit hiccups, etc), but also for the sheer economy of the loan.

>FHA Mortgage Insurance is cheaper on a monthly basis
>FHA loan are the most affordable loans on the market today
>FHA loans still go to 97% loan to value (require just 3% down payment)

There is no "declining market" hit for FHA (other loan programs have increased the down payment to 5, 10 or 20%)

And FHA loans are 30 year fixed rates.
>no Rate Adjustments
>no Interest Only
>no Negative Amortization.

Call the FHA loan pros to help with your safe, secure, affordable FHA loan. Call me at 866-900-2342 (toll free) or apply online at