Posted by SoCalGal on August 22, 2008 at 21:07:00:
In Reply to: Lending Noose gets Tighter... posted by Michael Morrongiello on August 22, 2008 at 17:24:57:
If you will allow me (mortgage broker) to elaborate a bit...
** As of October 1st- down payment assistance type programs or Loan
grants, or other seller contributions will be severaly limited. Here are
some underwriting changes, issues, etc. **Only SELLER assisted down payments are prohibited. City, County and
other types of institutional down payment assistance are still allowed.
One can still get a grant from Habitat for Humanity, for example.** Non traditional income documentation - Not permitted **
Stated income is still allowed for loans < 417000 but other means of
corroborating the borrower's income, as delineated by Automated
Underwriting, is required. Once you exceed 417000, all bets are off
and full doc is just about the only thing that will fly.** Debt to Income Ratio's - MAXIMUM 45% - no exceptions **
Not exactly true. If compensating factors exist (high FICO/reserves),
DTI can exceed 45 but only for loans <= 417000. Beyond 417000, 45
DTI is maximum.** It appears that cash out refinances [for investors] are now
forbidden**Not entirely true. If you have low LTV and you can go full doc, you can
still juice your property.Still, we're definitely in credit crunch mode.