Buying a home in Chantilly area during 2010? Be aware of Fannie Mae change.
December 26th, 2009 categories: Buyer Strategies, Mortgage & Finance
If you see a home purchase in Chantilly or surrounding area during 2010, and you will be doing what most folks do…applying for a mortgage…do be aware of some recent mortgage news.
Here is a very quick update on Fannie Mae’s latest tightening of home loan standards.
In its official announcement, Fannie Mae describes these changes as part of reducing long-term lending risks.
First, starting December 13, 2009, most of Fannie Mae’s loans require a 620 credit score minimum. There are a few exceptions, but not many.
The second change deals with mortgage insurance.
Homeowners whose loan-to-value exceeds 80 percent now have a choice:
- Pay higher mortgage insurance premiums month-after-month
- Pay a one-time fee paid at closing to compensate for higher risk
Third,. Fannie Mae will no longer approve loans with debt ratios exceeding 45 percent. The exception being very strong assets and very high credit scores.
There are other changes, but I think these are the major issues.
Everything changes with time, and I think it is a good guess that guidelines will tighten more over 2010.
If conditions are right for you now, consider your options. Good deals don’t matter much if you can’t get a mortgage.
By the way, if you need a few good mortgage loan referrals please call. I will give you the names of several reputable professionals.
