September 23, 2015
Since the FHA and HUD published the new Single Family home loan policy handbook, HUD 4000.1, we’ve been examining changes and updates to FHA loan rules. One such update affects the FHA 203(k) Streamline Loan, sometimes called and FHA streamline rehab loan.
According to the FHA official site, the changes are not being reported in a mortgagee letter or other official FHA/HUD document, because lenders are being asked to review the program policies in their entirety. That said, FHA/HUD did publish a brief list of updates with a few basic details.
“FHA is not publishing a detailed document of specific changes to the 203(k) product section,” the official site states, “as it is important that mortgagees and 203(k) consultants read the section in its entirety to understand the policy within the context of the entire section and the larger Origination through Endorsement section.”
“However, mortgagees should note several key changes in the section in particular:
–The Streamlined 203(k) Program name has been changed to its new name, Limited 203(k) Program.
–The establishment of a loan-to-value (LTV) ratio calculation of Mortgage Insurance Premiums (MIP) that is separate and distinct from the LTV ratio calculation for the maximum mortgage amount
–Revised appraisal requirements for properties that have sold in the previous 12 months.
–Elimination of the Form HUD 92700, Maximum Mortgage Worksheet, that was highlighted in the draft section posted for feedback. Technology is currently in development to automate the maximum mortgage calculation and make it available online as well as in FHA Connection. FHA will announce when this functionality is available.”
Participating lenders and others who may be involved with FHA Streamline loans are encouraged to review the new FHA loan policies. Online training is available, at the official site: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/events/sfh_hb_webinars
Do you work in residential real estate? You should know about the free tool offered by FHA.com. It’s designed especially for real estate websites–a widget that displays FHA loan limits for the counties serviced by those websites.
It is simple to spend a few seconds customizing the state, counties, and widget size for the tool; you can copy the code and paste it into your website with ease. Get yours today: http://www.fha.com/fha_loan_limits_widget
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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