The Mortgage Minute
New Developments in the Mortgage World of US Financial Mortgage Lending
- FHA now allows us to count some of the income from ADUs-75% of rent cannot be over 30% of overall income. Previously only Freddie Mac allowed it.
- Fannie Mae will now go to 95% loan to value on owner occupied 2-4 units. It was 85% on a duplex and 75% on 3-4 units.
- Below market financing for owner occupied properties in majority minority census tracts-rates ½ to ¾% below market.
- Freddie Mac is now allowing formerly self-employed people in the same field to be able to use fluctuating income from a job with under 12 months employment provided income is consistent with previous self-employment income.
- FNMA is now updating its policy to allow one year of personal and business tax returns, when all self-employed businesses have been in existence for five years and the borrower has a 25% or greater ownership interest for the last five consecutive years. DU will be updated and apply this guideline on all DU loan casefiles created on or after January 1, 2024. Currently FNMA requires two years of personal and business tax returns unless the DU AUS has the finding for just one year of taxes. FNMA is now updating this policy to allow one year of personal and business tax returns, when all self-employed businesses have been in existence for five years and the borrower has a 25% or greater ownership interest for the last five consecutive years. DU will be updated and apply this guideline on all DU loan casefiles created on or after January 1, 2024.
- On manufactured housing currently the guideline requires both the HUD Data Plate and the HUD Certification Label to be provided with photos on the appraisal. Effective immediately and mandatory effective January 1, 2024, based on application date, only one of the two will be required. This change does NOT apply to newly constructed manufactured homes, these items must be present on all new units.
- Soft pull credit pre-qualification must be done through our secure portal. This enables people to see what they qualify for without impacting their credit score.
- Update on CalHFA California Dream for All Program: Lottery system 90 days to get into contract. Must be first generation homebuyer earning under 120% of AMI. Coming early spring 2024.
- We can use excess seller contributions to lower cost of mortgage insurance on conventional loans.
- ]Fannie Mae will no longer count rental income other than to offset the monthly payment (no counting positive cash flow) unless the borrower has at least one year of experience managing rental property.
For more information please call 510-758-3035 or email ndonn@gemcorp.com