2012 FHA Future Bright

by Dean Henderson, CRMS

In spite of a gridlocked Congress, 2011 ended with some very positive legislation for the 2012 Federal Housing Administration (FHA) Loan Program.  The local housing market will benefit from higher FHA loan limits and an extension of the FHA Anti-Flipping waiver.

Thanks to the support of Antelope Valley Congressmen Howard “Buck” McKeon (R-CA) and Kevin McCarthy(R-CA) H.R. 2112 was passed by the US Congress which includes a provision to reinstate the FHA loan limit in high-cost areas for two years.

The higher Fannie Mae, Freddie Mac, and FHA conforming loan limits of $729,750 expired Oct. 1, when it was reduced to $625,500. The passage of H.R. 2112 provides for an extension of FHA-insured mortgages at the higher level of $729,750 in high cost areas, including Los Angeles and Orange counties, through December 2013.

Unfortunately, The US Senate and House could not agree on increasing the loan limits for Fannie Mae and Freddie Mac which marks a historic change in the long enjoyed higher max loan limits which were previously dominated by Fannie Mae and Freddie Mac.

In addition to the gift of higher FHA loan limits, FHA has also announced the extension of its “anti-flipping” waiver through the end of 2012, which allows buyers to purchase homes that have already been sold in the last 90 days.

The waiver, which was set to expire on December 31, 2011, has been extended through December 31, 2012.

An anti-flipping rule originally took effect in 2003 to stop a spike in home flipping that was being blamed on driving up home prices during the housing boom. The rule prevented FHA-backed loans from being used to purchase homes that had been owned by a seller for less than 90 days. But the U.S. Department of Housing and Urban Development decided to reconsider the 90-day limit in 2010 after skyrocketing foreclosures and abandoned homes were causing blight in neighborhoods across the country and hampering nearby property values.

The temporary waiver to the anti-flipping rule will allow buyers and investors to quickly resell refurbished homes and not have to wait 90 days to do so. Since the waiver took place in 2010, FHA has insured nearly 42,000 mortgages worth more than $7 billion on homes resold within 90 days of the last purchase, according to HUD.

The 2012 extension includes requirements that flip transactions be arms-length transactions and requires sellers to document improvements to properties to justify profits in excess of 120% of the seller’s acquisition price.

For more FHA Loan information contact:

Dean Henderson, CRMS

(661) 726-9000

 

 

New VA Loan Limits for 2012

 

The United States Department of Veteran Affairs just released the new loan limits for VA Loans for 2012. These limits vary by county. Higher costs counties will enjoy higher VA loan limits. Included in the high cost counties locally are Los Angeles County, Orange County, Ventura County and San Diego County.

Other Counties which are not considered high cost Counties include Kern, Riverside and San Bernardino. These counties will remain at the lower maximum limit of $417,000 with zero down payments.

The maximum VA Loan Limit with zero down in the high cost Counties will be as follows:

Los Angeles County $621,000
Orange County $621,000
Ventura County $518,650
San Diego County $477,000

For a Veteran who wishes to exceed these maximum loan limits they can still get a VA loan but there will be a down payment requirement for the amount borrowed over the County Maximum limit. So, for instance, if a Veteran wants to buy a home for $700,000 in Los Angeles County they will get zero down for the first $621,000 and then the remaining $79,000 will be subject to a down payment of 25% of the $79,000 which is $19,750. In this example the buyer would get a VA loan in the amount of $680,250 which is 97.18% of the sales price. Their down payment of $19,750 would be less than 3% of the sales price.

For more information about VA Loans contact Dean Henderson at 661-726-9000. Dean has been originating and closing VA loans for over 20 years. He is Certified Military Housing Specialist, Certified Cal-Vet Broker, and Approved by the United States Department of Veteran Affairs.

For a Free VA Loan Pre-Qualification call Dean Henderson at 661-726-9000.

You can also visit:
www.CalVet-Loans.com

 

VA Funding Fee Changes 01-Oct-11

Changes to VA Funding Fee!

Per current United States Code and recently passed Public Law 112-026 (Restoring GI Bill Fairness Act of 2011), VA Funding Fees are set to decrease for VA transactions funded after September 30, 2011. Unless Congress passes further legislation, VA Funding fees are updated as indicated the chart below:

If you have any questions about this, or would like to see if you or a loved one is eligible for a VA loan – or any other type of mortgage, feel free to contact me directly any time.

Dean Henderson
(661)726-9000
dean@avrefi.com