FHA Down Payment – Changes Effective October 1
Effective October 1, 2008, FHA has changed their down payment requirements and maximum LTV guidelines.
To sum it all up:
1. One standard down payment requirement of 3.5% for all purchases
2. Closing costs/prepaids are in addition to the 3.5% down (6% seller contribution still allowed)
3. New maximum LTVs (based on lower of sales price or value) are:
* 96.50% for all purchases.
* 98.28% for all regular rate and term refinances (cash out remains at 95%).
* 98.52% for all streamline refinances.
These changes are effective October 1st, 2008.
Purchases already in the pipeline will have until December 31st to be assigned a case number. After January 1st, 2009, all purchases will require the new down payment requirements.
