Logan Utah Mortgages and Real Estate: Fannie Mae Continues to Tighten Credit Guidelines: Interest Only Loans

Fannie Mae Continues to Tighten Credit Guidelines: Interest Only Loans

Via Mike Jones (SUNSTREET MORTGAGE, LLC):

Interest only loan

My borrowers bought a beautiful second home here in Tucson at the end of May, and wanted to make the smallest possible monthly payment until their retirement in a few years.

The loan that they chose has an Interest Only feature that reduced their payment by many hundreds of dollars when compared to a fully amortized payment.  They paid 20% at closing, and financed 80%.

Fannie Mae continues to tighten credit guidelines

Today, FNMA reduced the maximum LTV/CLTV (loan to value / combined loan to value) to 70% on all interest only loans.  Had my clients waited a month, they would have had to come out of pocket another 10%!

Fannie Mae announced that they will no longer accept the following transactions with an interest only feature:

  • Cashout
  • FLEX mortgages
  • My Community loans
  • Investment properties
  • Duplex to Four Family units
  • Credit scores below 720
  • Borrowers with less than 24 months reserves

 

I'm Mike in Tucson, your preferred Tucson Mortgage Lender.

NMLS #223495

SUNSTREET MORTGAGE llc ~ Mortgage Bankers, Not Brokers!
Offices in Scottsdale, Tucson, and Nogales, AZ, and Albuquerque, NM.

Reach me any time on my Blackberry (520) 349-9090

2 commentsJohn Neil • June 08 2010 07:23PM

Comments

John,

Thanks for the reblog.  It's getting harder and harder for folks to find credit, and FNMA is crawling back in its shell.

Mike in Tucson

Posted by Mike Jones (SUNSTREET MORTGAGE, LLC) 2 months ago

Sure thing!  I always enjoy your blog posts.  By the way, I am loving eyeonmyloan.com. I've gotten awesome feedback. Thanks again!

Posted by John Neil (Wasatch Mortgage Solutions) 2 months ago

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