5 New Mortgagee Letters, Property Flipping Waiver and Extension on ML 2009-19 Effective Date

Written By: Stacey Sprain,
Certified Ambassador Loan Processor (CALP)

HUD issued five new Mortgagee Letters on September 18th but none of the bulletins addressed the information I was looking for as explained in last week’s article. As I explained last week, the Moratorium on Risk Based Premiums is set to expire at the end of this month and so far I have heard no word on whether or not the moratorium will be extended or if HUD will divert back to the risk based premium structure that based mortgage insurance premiums on fico score and loan-to-value ratio. However, I have since located where HUD has publicly addressed the rumored month delay in the implementation of the condominium requirements of Mortgagee Letter 2009-19. You’ll find the following paragraph at HUD’s Single Family Housing Website http://www.hud.gov/offices/hsg/sfh/hsgsingle.cfm:

Notice on FHA Condominium Processing: Mortgagee Letter 2009-19 provided guidance on the new approval process for Condominium Projects, allowing lenders to determine project eligibility, review project documentation, & certify to compliance of Section 203(b) of the National Housing Act and 24 CFR 203 of HUD's regulations. This new approval process was effective for all case numbers assigned on or after October 1, 2009. However, the new effective date is for case numbers assigned on or after November 2, 2009. The site condo & manufactured housing condo project changes that have already taken effect are not affected by this delay

In addition, HUD also communicates that the Property Flipping Waiver has been extended for another 12 month term. This means the continued exemption to the 90 day ownership requirement for sales of previously foreclosed or abandoned properties acquired and resold by for-profit and non-profit entities using funding from and performing under agreements with state and local government agencies under the NSP program. This latest waiver will expire September 13, 2010.

Now, on to the Mortgagee Letters. I will address those changes that are set to take affect in order of priority. Due to the length of content, I will split up these reviews between this week and next week’s articles.

Mortgagee Letter 2009-32 addresses new FHA streamline refinance requirements which will be effective for cases assigned on and after November 17, 2009. These changes are somewhat significant so if you have opportunity to streamline refinance any FHA loan borrowers, take advantage of today’s guidelines, get them locked and get your cases assigned ASAP before the November 17th cutoff.

Click here for a rundown of the changes: Mortgagee%20Letter%202009%20Changes.pdf

About the Writer. As one of NAMP's volunteer writers, Stacey Sprain is currently a NAMP member in good standing and is a NAMP Certified Ambassador Loan Processor (CALP). If you would like to become a volunteer writer for NAMP, please email us at: blog@mortgageprocessor.org.

SOURCE: Published by NAMP Publishing Group, a division of the National Association of Mortgage Processors (http://www.MortgageProcessor.org)