Updates to FHA appraisal Guidelines

HUD has announced new rules requiring 2 appraisals on FHA loans that fall under the new stimulus package loan limits (those loans over $362K). While this may seem prohitibitive at first glance, and it will add to the time & expense of an FHA loan, it is a relatively easy hurdle to work with.

First of all, it is important to remember that FHA loans are more affordable alternatives to their Fannie & Freddie counterparts. FHA loans also still allow downpayments of just 3%, whereas Fannie & Freddie require 3% minimum now, and for loan amounts over $417K, 5% is required. In Declining markets such as Riverside, Ca, Sacramento, CA, Miami, FL, and San Diego, CA Fannie & Freddie increase the minimum another 5%. FHA does not require extra down payment in "declining markets". Even better, with Down Payment Assistance programs such as the Nehemiah program, homeowners can get into a new home for zero down payment.

Back to the second appraisal. Here is the good news part of the program. It will give the buyer some confidence that the appraisals are legitimate and accurate, and also give the opportunity to renegotiate price or exit a contract if the appraised value won't support the sales contract price. There is some latitude given to the second appraisal process in the HUD regulations. It can vary by up to 5% without effecting the original appraisal's use for the financing. It is a less invasive appraisal, as SFR 2nd appraisals won't require interior photos. Downside: the 2nd appraiser comes from the HUD list, which may result in slower turn times due to volume in high cost areas. (this is good news for FHA approved appraisers though!).

If you could benefit from an FHA loan, it is wise to work with a lender with strong FHA experience. VanDyk Mortgage has been a direct FHA lender for over 20 years. Call Brian Skaar at 866-900-2342 (toll free) or visit us online at www.vandykfunding.com to find out if FHA is right for you. FHA offers security, safety and affordability.

Quick primer on new California FHA loan limits

The mortgage limits set by HUD for FHA loans (Federal Housing Administration) for California counties were raised in March. The new limits are set relative to the median price of homes in each county. The bad news: the new limits will only be effective until the end of 2008.
San Diego’s limit has been raised to $697,500 from just over $362,000, while Orange County and Los Angeles county are both at the max of $729,750 now. This change comes as part of the effort to support the origination of larger mortgages, which should lead to lower interest rates. Many Jumbo loan holders or home buyers have been hesitant to finance given the high rates that Jumbo loans have experienced the past few months.

FHA Mortgage Limits in California by County

Alameda County
Median home price $995,000
new FHA Limit $729,750

Alpine County
Median home price $438,000
new FHA Limit $547,500

Amador County
Median home price $355,000
new FHA Limit $443,750

Butte County
Median home price $320,000
new FHA Limit $400,000

Calaveras County
Median home price $370,000
new FHA Limit $462,500

Colusa County
Median home price $318,000
new FHA Limit $397,500

Contra Costa County
Median home price $995,000
new FHA Limit $729,750

Del Norte County
Median home price $249,000
new FHA Limit $311,250

El Dorado County
Median home price $464,000
new FHA Limit $580,000

Fresno County
Median home price $305,000
new FHA Limit $381,250

Glenn County
Median home price $230,000
new FHA Limit $287,500

Humboldt County
Median home price $315,000
new FHA Limit $393,750

Imperial County
Median home price $260,000
new FHA Limit $325,000

Inyo County
Median home price $350,000
new FHA Limit $437,500

Kern County
Median home price $295,000
new FHA Limit $368,750

Kings County
Median home price $260,000
new FHA Limit $325,000

Lake County
Median home price $321,000
new FHA Limit $401,250

Lassen County
Median home price $200,000
new FHA Limit $271,050

Los Angeles County
Median home price $710,000
new FHA Limit $729,750

Madera County
Median home price $340,000
new FHA Limit $425,000

Marin County
Median home price $995,000
new FHA Limit $729,750

Mariposa County
Median home price $330,000
new FHA Limit $412,500

Mendocino County
Median home price $410,000
new FHA Limit $512,500

Merced County
Median home price $378,000
new FHA Limit $472,500

Modoc County
Median home price $125,000
new FHA Limit $271,050

Mono County
Median home price $370,000
new FHA Limit $462,500

Monterey County
Median home price $599,000
new FHA Limit $729,750

Napa County
Median home price $615,000
new FHA Limit $729,750

Nevada County
Median home price $450,000
new FHA Limit $562,500

Orange County
Median home price $710,000
new FHA Limit $729,750

Placer County
Median home price $464,000
new FHA Limit $580,000

Plumas County
Median home price $328,000
new FHA Limit $410,000

Riverside County
Median home price $400,000
new FHA Limit $500,000

Sacramento County
Median home price $464,000
new FHA Limit $580,000

San Benito County
Median home price $790,000
new FHA Limit $729,750

San Bernardino County
Median home price $400,000
new FHA Limit $500,000

San Diego County
Median home price $558,000
new FHA Limit $697,500

San Francisco County
Median home price $995,000
new FHA Limit $729,750

San Joaquin County
Median home price $391,000
new FHA Limit $488,750

San Luis Obispo County
Median home price $550,000
new FHA Limit $687,500

San Mateo County
Median home price $995,000
new FHA Limit $729,750

Santa Barbara County
Median home price $615,000
new FHA Limit $729,750

Santa Clara County
Median home price $790,000
new FHA Limit $72,9750

Santa Cruz County
Median home price $719,000
new FHA Limit $729,750

Shasta County
Median home price $339,000
new FHA Limit $423,750

Sierra County
Median home price $228,000
new FHA Limit $285,000

Siskiyou County
Median home price $235,000
new FHA Limit $293,750

Solano County
Median home price $446,000
new FHA Limit $557,500

Sonoma County
Median home price $530,000
new FHA Limit $662,500

Stanislaus County
Median home price $339,000
new FHA Limit $423,750

Sutter County
Median home price $340,000
new FHA Limit $425,000

Tehama County
Median home price $250,000
new FHA Limit $312,500

Trinity County
Median home price $200,000
new FHA Limit $271,050

Tulare County
Median home price $260,000
new FHA Limit $325,000

Tuolumne County
Median home price $350,000
new FHA Limit $437,500

Ventura County
Median home price $599,000
new FHA Limit $729,750

Yolo County
Median home price $464,000
new FHA Limit $580,000

Yuba County
Median home price $340,000
new FHA Limit $425,000

FHA Jumbo loans

They are now here. FHA Jumbo loans. The new stimulus bill allows FHA loans up to $729,750 in the highest cost markets. Even if you are not in one of these markets, your loan limits have increased. Click here to access the limits for your area. (pdf will take a moment to load).

The FHA jumbo loan is fast becoming our most popular loan with the wider range of qualifying rules, (lower fico's, credit hiccups, etc), but also for the sheer economy of the loan.

• FHA Mortgage Insurance is cheaper on a monthly basis
• FHA loan are the most affordable loans on the market today
• FHA loans still go to 97% loan to value (require just 3% down payment)
• There is no "declining market" hit for FHA (other loan programs have increased the down payment to 5, 10 or 20%)

And FHA loans are 30 year fixed rates.

• no Rate Adjustments
• no Interest Only
• no Negative Amortization.

Call the FHA loan pros to help with your safe, secure, affordable FHA loan. Call me at 866-900-2342 (toll free) or apply online at www.vandykfunding.com .

Another Score for FHA loans

FHA Loans guaranteed by HUD are fast becoming the loan of choice again for first time homebuyers and also those buyers who do not want to put 5, 10 or 20% down payment on their new home (there is good reason to keep your assets in other areas, that will be another post, or call me to find out why). The FHA loan requires just 3% down payment. Sellers can contribute to down payment and closing costs as well, it just requires the use of one of our Down Payment Assistance programs to administer the transfer of funds. (HUD requirement). So an FHA Loan can be a 100% loan in that regard.

With Fannie & Freddie declaring many metro areas "Declining Markets" it is now harder to qualify (if at all) for low down payment loans from Fannie & Freddie in many markets. For instance, if you live in Riverside California, a widely recognized trouble spot for foreclosure activity, your maximum loan to value (LTV) with Fannie & Freddie is now 95%. But wait, there's more. Fannie & Freddie also limit the fico's that qualify for 95%, and add to the price.
That makes it difficult and expensive to go with a Fannie or Freddie low down payment loan.

So what? FHA is what. FHA doesn't ding you for a declining market, they still go to 97%.
FHA also doesn't have the FICO minimums that Fannie & Freddie do. It is not only easier to qualify, but more cost effective.

Work with the FHA loan pros, call Brian Skaar and VanDyk Mortgage to handle your FHA loan.
Brian Skaar 866-900-2342 www.vandykfunding.com