Be aware of the following if you’re an FHA borrower.
If you’re on the market for condos or townhouses, effective February 1st, “spot approvals” will no longer be available. Spot approvals are stopgaps for FHA buyers to try to purchase properties, where the HOA has not been FHA-approved. You can check here for a list of FHA-approved HOAs in your area. (No one at HUD’s SF office has returned my calls ascertaining the completeness of that online database!) Our in-house Wells Fargo lender has hinted that Wells would be offering a spot approval alternative for non-approved HOAs; details (may be) forthcoming….
Also, FHA’s upfront mortgage insurance premium will increase from 1.75 percent to 2.25 percent of the loan. This will take place in the spring.
This summer, expect FHA’s credit standards to tighten too. A minimum FICO score of 580 will be required to qualify for FHA’s 3.5 percent downpayment program. Lower FICO’s will require at least 10 percent down.
