Seattle Mortgage & Housing Market Insights

In light of increasing FHA participation especially in first-time home buyers arena and increasing exposure of borrower's default, FHA is implementing a few rule changing guidelines:

1. Minimum FICO score of 620 is required for 3.5% down payment. Minimum score of 580 is required to have 10% down payment.
2. Effective with FHA case number assigned on or after 2/15/10, FHA is in full compliance with HVCC in regards to ordering appraisal. Mortgagee Letter 09.28.
3. Effective with FHA case number assigned on or after 4/15/10, upfront mortgage insurance will be increased from 1.75% to 2.25%.
4. FHA is seeking congress approval to increase monthly mortgage insurance currently at .55% for > 95% LTV and .50% for < 95% LTV.
5. Seller concessions is limited at 3% (currently at 6%).
6. Site Condominium (detached condo) - Effective with case number assignment after 12/7/09 - The condominium project is not required to be FHA approved. Site Condominiums are defined as single family totally detached dwellings (no shared garages or any other attached buildings) encumbered by a declaration of condominium covenants or condominium form of ownerships. 2009-46B.
7. FHA reversed anti-flipping rules effective 2/1/10 for 1 year. Properties are elligible for FHA financing with 90 days or less ownerships.