Conventional guidelines keep tightening.


Recent Conventional Loan Changes

1) Ocean and Monmouth County has been designated a Declining Market Areas for Conventional loans.

What it means: For example, if your buyer is putting 10% down they are now considered a 5% down loan. This will cost your buyer an additional $65 a month in PMI costs on a $300,000 mortgage. In addition, this also eliminates no money down loans.

2) Conventional buyers now have to pay increased fees if they are putting less than 30% down and have credit scores below 680.

What it means: For example, if a client applying for a $300,000 has a score less than 620 it will cost him around $123 more a month!

Credit Scores less than 620
Additional 2 points or approximately 5/8% to the interest rate.

Credit Scores between 620-639
1.75 points or approximately 1/2% to the rate

Credit Scores between 640-659
1 1/4 to the points or approximately 3/8% to the rate

Credit Scores Between 660-679
.75 to the points or approximately 1/4% to the rate

3) Conventional loans now require a minimum 10% down on all condominiums.

--------------------------------------------------------------------------------

Avoid these Restrictions : Think FHA

FHA still allows as little 2.25% down.

There are no rate increases on FHA loans until credit the score is below 585

Select Mortgage is a direct endoresement FHA underwriter draft

FHA also allows non-occupant cosigners