- FACT: Mortgage Insurance companies will now issue conventional mortgage insurance up to a bank-end debt ratio up to 50%, depending upon credit profile. Hard and fast rule used to be 45%. Coverage is not necessarily higher for the borrower. Opens the pool of options for borrowers.
- We are looking at purchasing a HUD REO property. The house needs repairs. What is the process for this - how do we determine repair amount? We must order a new FHA appraisal, we can no longer use the appraisal FHA ordered to establish the list price. Prior to THF ordering the appraisal a copy of the PCR (property condition report) must be obtained from the FHA REO Management and Marketing Contractors. We then send the PCR to our appraiser to assist with determining what repairs/ if any are required to meet minimum property requirements. If the utilities are off at time of inspection the appraiser must include the information provided in the PCR and refer to the PCR in the applicable sections of the appraisal report. The FHA sales contract will state "repairs to be determined by lender's appraisal". Until our appraisal is received we will not be able to confirm the exact amount of "escrow repairs" that can be financed into the loan amount (Maximum is $5000, if repairs exceed $5000 the loan will need to be converted to an FHA 203K). The management company can also supply you with a copy of the "disclosure/repair information". This form lists/breaks down the MPR (minimum property requirements) and non MPR items which can assist in determining the escrow repair amount until the appraisal is received.
- I am in the process of purchasing a new home. I found one that I really like, but it needs some work. I would like to put 10% down, and I would like to fund the renovations. By my guess, I believe I would need to borrow about 450,000. Can I do this? Do I need a construction loan? We actually now have a high balance renovations program. Maximum that can be borrowed in our area is 458,850, and YES, you can use the program with 10% down.
Please feel free to contact me with any questions you might have. I look forward to working with you and your clients. Please remember, I am licensed in Virginia, North Carolina and Florida.
Jennifer Keenan, Sr Mortgage Consultant, NMLS# 101837
Tidewater Home Funding, 757-272-4199