Hal's Mortgage Blog

We all know about the troubles Fannie and Freddie have had the past few years so it comes as no surprise that they continue to tighten their guidelines. These changes go into effect as of December 11, 2010.

• If you’ve had a foreclosure, you must now wait 7 years before you can get another loan. This is up from 4 years.
• All revolving credit must be calculated in your Debt to Income (DTI) ratio, regardless of the number of payments remaining. Previously if you had 6 months or less until paid off it was not counted.
• The maximum DTI allowed will drop to 45%. The current guidelines allow 55%.

 
These changes affect only conventional loans underwritten with FannieMae Desktop Underwriting guidelines. I expect FreddieMac to follow suite in the near future.

So far, FHA remains unchanged and continues to be a strong viable option for purchase loans.

 
Need more info? Call me – let’s discuss your options.