Can I get a hallelujah?
As of March 1, 2009 Fannie Mae will increase their current restriction of a max of 4 financed properties BACK to 10!
YOU HEARD ME RIGHT!!!!!!!!!
Ahhhhhh... They finally came to their senses!
Here is an exert from their announcement that came out today!
Fannie Mae is committed to providing financing opportunities for high-credit quality, bona fide investors. Experienced investors play a key role in the housing recovery (duhhhh!) and Fannie Mae's continued support for investor borrowers is consistent with its mission to provide stability, liquidity, and affordability to the nation's housing system.
Fannie Mae is updating the policy that pertains to multiple mortgages to the same borrower. Fannie Mae's current policy limits the number of one- to four-unit financed properties in which the borrower may have an individual or joint ownership interest to four financed properties when the mortgage being delivered to Fannie Mae is secured by an investment property or second home.
The limitation on the number of mortgages currently being financed applies to the total number of properties financed, not just the number of mortgages sold to Fannie Mae. Fannie Mae is modifying this policy to allow investor and second home borrowers to own five to ten financed properties if they meet certain eligibility and underwriting and delivery requirements as outlined in this Announcement.
The new guidelines include a 720 minimum credit score... OK we can do that!
... and 20% down for 1 units and 25% down for 2-4 units!... No problem!
Here some more rules...
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The borrower cannot have any history of bankruptcy or foreclosure within the past seven years.
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The borrower cannot have any delinquencies (30-day or greater) within the past 12 months on any mortgage loans.
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Rental income on the subject investment property must be fully documented.
(Rental income from other properties owned by the borrower must be supported by two years' federal income tax returns) I am not sure how they will deal with purchases that were made after your tax return was prepared though... -
The borrower must complete and sign Form 4506 Request for Copy of Tax Return or 4506-T Request for Transcript of Tax Return (we have all clients sign this upfront ...so no worries)
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The borrower must have reserves for the subject property and for other properties currently owned by the borrower. (will need 6 months reserves for each PITI payment in the bank)
These are all very doable! I think Fannie Mae must have read my rant about how they are picking on Investors !
I can't wait to call the Lender that has one my files for the last 45 days! They have been stringing me and my Client along!I have had to bite my tongue because I had no other options. For those who know me... this has been rough. Especially because the guy pretty much told me he could care less about my file and I could wait. That dog just does not hunt!
You can imagine the satisfation I will feel when I rank this file first thing Monday morning! It is a refinance file so I don't have a time contraint and the client will get a better loan elsewhere.
I can't remember the last time I was so darn happy about a guideline change! I going to crack open that bottle of champagne in the fridge and we are celebrating tonight! No really .. I am!
THANK YOU THANK YOU THANK YOU THANK YOU! This had been the number 1 pain in my side for months!
So all you investors out there who have been on the sidelines... it is time to get back in the game. Dust off those calculators and get out in the streets and look at some real estate!
What a great way to end the week!
Here is a link to the press release >>
This blog by:
Team Newington
Sacramento Mortgage Planners
(916) 687-6868
www.SuperiorLoanTeam.com
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You're kidding...right? They finally came to their senses? This is wonderful news! I'm so excited...I have several phone calls to make in the next few days! This has been a pain in all of our sides for the past few months...
I know! I am so stocked! I have MANY files that have been on hold because if I could find a lender who could do it... they offered a really bad loan program (1 year ARM).
This is AWESOME!! So great in fact, I linked your post to my blog!
http://sacramentorealestateblog.blogspot.com/2009/02/fannie-mae-increases-limit-of-4.html
That is great Erin! We really appreciate the repost of our blog!
HELLO PEOPLE....
6 MONTHS PITI IN RESERVES FOR EACH PROPERTY.
This is just another "sounds good" on paper but will have LITTLE EFFECT on the street as the VAST MAJORITY of buyers WILL NOT QUALIFY.
I disagree completely! A paper borrowers (those who have great assets and income) are lining up for this program. Most folks who have this amount of homes have (or should have) 6 months reserves in the bank. If they don't... they might want to reconsider buying more property in this economy.
This program is for solid borrowers and will help the majority of our investor clients. This is a HUGE change and I would have to disagree with you ... it will help many folks!
Thanks for your opinion though!