FHA Standard Program Updates

HomeBridge is announcing updates to the FHA standard program.

  • The 620-639 credit score topic has been updated as follows:
    • Borrowers with documented housing history are now limited to a maximum 95% LTV for purchase and rate/term transactions (currently allows 96.50% LTV)
      NOTE: The LTV restriction for borrowers without documented housing history remains unchanged at 90% LTV.
    • 4 months reserves are required (currently 2 months required)
  • The pay down of installment debt to < 10 months to qualify the borrower may be considered on an exception basis only subject to the following:
    • Borrower has strong reserves (no gifts or grants)
    • High credit score
    • DTI with debt included must be ≤ 43%
    • HomeBridge management approval required
  • As a reminder, HUD requires debt with < 10 months remaining to be included in the DTI if the amount of the debt will affect the borrower’s ability to pay the mortgage in the months immediately following loan closing particularly when the borrower has little or no reserves.
  • 4 months reserves on 3-4 unit properties is required (currently 3 months) regardless of the credit score.

These changes are effective with loans submitted on or after January 25, 2013.

The FHA Program matrix has been updated and posted to the HomeBridge website at www.homebridgewholesale.com.

If you have any questions, please contact your Account Executive.