FHA Streamlines w/o appraisal 2008 mortgage limits

Just a heads up, I've been talking to FHA and they should be posting a new ML stating your can do a FHA Streamline without an appraisal using the 2008 loan limits in 2009.  Should open up some deals for purchases or refi's from last summer.

Just FYI if you've got deals that won't work because your loan limits have gone down.

Nice to see some common sense MLs coming down once in a while.

Yep otherwise all those people who used the higher limits are stuck in a pseudo prepayment penalty that restricts refinancing.  We'll see, keep your fingers crossed for quick action. Although with all the early payoff concerns for portfolios maybe they wait a while and roll it out summer when rates go back up that way it doesn't really help anyone.

Sorry did that sound sarcastic?

I've turned away at least 3 of those deals all ready...not sure how many could actually happen as most of those clients probably doesn't have the funds to bring to closing...

Do you have to wait a full 12 months since the funding of an FHA loan to do an FHA streamline without appraisal?  And with a refinance of an existing FHA loan, what happens with the MIP?  If it was financed originally, does the borrower have to pay it again or does it roll to the new loan? 

I also heard yesterday that the FHA limits are still up to $729,500.  I thought that was reduced to $625,500.  What have you guys heard?   There have been some many rumors lately, it's getting hard to figure out what is real and what is not.

apparently from above, the limits are still at $625k, but will soon be up to $729k or whatever the limit was for that county in '08 just for streamline loans orginated in '08...

and all fee's are assessed again except an appraisal...MIP is 1.5% instead...and the borrower gets a portion of original MIP back...

You'll need to check the loan limits in the county or MSA on HUD's website to know the 2009 limits. Some areas are the same as 08' but most are lower.  But it really does depend on the county & MSA.

The funding fee is 1.5% on streamlines w/o appraisal and 203k loans.  And they still get a prorated credit for their previous MIP for the first 3 years.

I haven't seen the mortgage letter yet (it's not out). I emailed FHA and asked the question and they email back saying the letter is on the way.  And yes, we're going to need the mortgage letter to try to get our lenders to follow the guidelines.

Clem Borkowski:

And yes, we're going to need the mortgage letter to try to get our lenders to follow the guidelines.

And even then, we may have some that won't offer it.

How is the prorated credit for the MIP calculated?

I do my of my lending in the top of the high cost limits.  Last year, it was $729,250, but with FNMA and FRMC the new max limit is $625,500.  Is that the same for HUD or is the max for '09 still at $729,500.  I have problem's finding a news release that spells this exactly out.

MIP is calculated as follows and is contained in HUD Mortgagee Letter 2008-16

Refund of Upfront Premiums.  Refunds of upfront premiums are available to borrowers refinancing to another FHA-insured mortgage within a three-year time period, as shown below. 

On any refinance where the MIP refund exceeds the Upfront MIP required on the new loan, the overage will be refunded directly to the borrower from HUD.  The lesser of the MIP refund or the new upfront MIP should be subtracted from the unpaid principal balance before calculating the new mortgage amount.

I don't know the high cost limits as it doesn't affect me in my area.

For anyone still looking, here's a link to where you can check the loan limit in your county or msa.

https://entp.hud.gov/idapp/html/hicostlook.cfm

Any time frame on this Clem?

I just received from Taylor Bean this morning that FHA has told this it's ok to do a FHA Streamline without an appraisal with out worrying about the 2009 loan limits.  Might check there.

Anyone know if Fannie and Freddie are going to bring back the 2008 limits, and if so, when?

Ethan Brizzi:

Anyone know if Fannie and Freddie are going to bring back the 2008 limits, and if so, when?

 

I haven't seen anything about Fannie/Freddie changing anything. And if they did it would only impact the very high end (conforming jumbo) markets. It's $417,000 and was $417,000 for most of the country.

Clem Borkowski:

I just received from Taylor Bean this morning that FHA has told this it's ok to do a FHA Streamline without an appraisal with out worrying about the 2009 loan limits.  Might check there.

Has HUD put out anything in writing on this yet????

Kent Mikkola:

Has HUD put out anything in writing on this yet????

When I spoke to HUD about 3 weeks ago I was told they were working on the official mortgage letter. I do know that they have verbally said ok to a handful of lenders, like TBW. I'm still waiting for one as well.

Luckily my lender, MidCountry Bank, received this as well. 

Thanks for the update.