York, PA Real Estate

FHA financing has become very popular over the last few years, as it offers a way for home buyers to purchase a home with only 3.5% cash out of pocket.  Dramatic changes to FHA were just enacted and some are still pending to be enacted in the next 3 months. 

•1.     As of today there is no longer 3 months seasoning for investor properties.  Let me explain...... If you buy a home as an investor, you can sell that property the next day for the appraised value......as long as that value does not exceed 20% above your purchase price.

•2.     Increase MIP up front Fee for FHA loans in the next months, It appears FHA upfront MIP will increase from 1.75% to 2.25%.

•3.     Seller's concession "help" is slated to be reduced from 6% to 3%.

•4.     No loan under 580 FICO will be done with FHA in the future.

•5.     580 to 619 FICO will be required to have a 10% down payment (most lenders already will not take a loan under 620 FICO)

WHAT DOES THIS MEAN?

If you are on the fence about buying a home, this should make it even more enticing to purchase before the Spring of 2010.  The tax credit will end for any contract signed after April 30^th 2010; your buyer will not be able to get 6% sellers help, but rather 3%.  This will probably take affect in early spring.