FANTASTIC NEWS!!

They have just released the new updated FHA loan limits.  Go to this link and find out what your state and county limit has been changed to: https://entp.hud.gov/idapp/html/hicostlook.cfm For Minneapolis -St Paul and the majority of the Twin Cities area the loan limit for single family homes has just been increased to $365K for single family homes.  Mpls-St Paul are considered hight cost areas-not everywhere in our state are we considered high cost.  This means that going forward, you will be able to finance more homes using FHA financing.  FHA financing is important to borrowers who want to be able to take advantage of some of the unique features of FHA mortgage loans.  More borrowers and buyers will be able to benefit from this great government program. In the Wall Street Journal today, they had an article saying they anticipated that 1/3 of the loans done this year will end up being FHA.  I would estimate it might even be more!  Conventional zero down loans are gone in MN for at least a while.

For example, you can do a cash out refinance up to 95% loan to value. 

You can finance a home downpayment with a gift program like the Nehemiah program-which essentially makes the home 100% financed.

If you had an ARM that had a teaser rate, and you were current with payments during the 2 or 3 year period before it adjusted, you may be eligible to refinance into a FHA Secure mortgage.

You can do a rehab loan combined with an initial purchase loan under the FHA 203K

The FHA ARM has 1/5 caps with annual adjusters of 1%.  Most conventional ARMS are 5/2/5 or 6/2/6 caps with an annual 2% adjuster and a higher margin.

You get a flat .5% MI (mortgage insurance) factor on FHA loans.  Conventional loans vary by down payment and credit score. 

You can do temporary and permanent buydowns off of the interest rate.

There are product changes on FHA reverse mortgage coming too.  They just aren't here quite yet.

These are some of the major differences between a conventional and FHA Loan-there are more.  Call us for more information at 952-285-4319 or visit our Minnesota mortgage website