Nevada Real Estate >> Las Vegas Real Estate Specialist: Effective immediately on Fannie Mae Loans July 7/12/11- No seasoning on cash out refinances

Effective immediately on Fannie Mae Loans July 7/12/11- No seasoning on cash out refinances

If you have a buyer wanting to buy a home who can pay cash but doesn't want to tie up all of their cash reserves consider this:

 

Effective immediately on Fannie Mae loans 

Borrowers who purchased property within the past six months are eligible for a cash-out refinance if all of the following requirements are met:

  • The new loan amount is not more than the actual documented amount of the borrower's initial investment in purchasing the property, plus the financing of closing costs, prepaid fees, and points (subject to the maximum LTV, CLTV, and HCLTV ratios for the transaction).

 

  • The purchase transaction was an arms-length transaction.

 

  • The purchase transaction is documented by the HUD-1, which confirms that no mortgage financing was used to obtain the subject property.

 

  • The source of funds for the purchase transaction can be documented (bank statements, personal loan documents, HELOC on another property). Any loans used as the source for the purchase transaction will be required to be repaid on the new HUD-1.

 

  • All other cash-out refinance eligibility requirements are met and cash-out pricing is applied.

Note:  The preliminary title search must not reflect any existing liens on the subject property.  If the source of funds to acquire the property was an unsecured loan or HELOC (secured by another property), the new HUD-1 must reflect that source being paid off with the proceeds of the new refinance transaction

 

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5 comments • Nevin Williams, San Diego's best mortgage pro! • July 12 2011 01:23PM

Comments

That is fantastic news for those cash buyers who wish to use the cash for other things now Nevin!

Posted by Wanda Kubat-Nerdin, REALTOR® St. George, Utah (Prado & Kramer Real Estate, St. George, UT 435.632.9374) 11 months ago

Appears we got the same memo!  Yes, this is good news!

Posted by Karen Burket-Bank of Oregon Home Loans Conventional, FHA, VA, mortgages (Bank of Oregon a division of Willamette Valley Bank ) 11 months ago

Wanda - This is great news!

Karen - Hi there!  Nice to see someone else actually reads these memos too!  LOL  Thank you for stopping by my blog  : )

Posted by Nevin Williams, San Diego's best mortgage pro! (First Priority Financial, San Diego jumbo & conventional ) 11 months ago

Quite interesting, and might be very useful to cash buyers. 

Posted by Carla Muss-Jacobs - Principal Broker/ Owner | Exclusive Buyers Agent | (503-810-7192 | BuyersAgentPortland.com) 10 months ago

Carla - It is!  I have had cash buyers in the past ask if they can take out cash after closing on a purchase. When the answer was no they decided not to buy.

Posted by Nevin Williams, San Diego's best mortgage pro! (First Priority Financial, San Diego jumbo & conventional ) 10 months ago

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