CONVENTIONAL vs. FHA

 

                        CONVENTIONAL                       FHA

MAX LOAN        $625,000                                                      $729,750

 RATIOS              28/36                                                           31/43

 LTV                    
   Purchase             95% (5% down)                                         96.5% (3.5% down)
   REFI-No Cash   95%                                                            98.5%
   REFI-Cash         80%                                                            85.0%
 CREDIT              620-680+                                                     620
                *maybe below down to 540 with
                approved/eligible
 
M.I.                      PMI Above 80%                                          M.I.P. 1.5%*
                                                                                                                                                                *Ranges from 1.25% to 2.25%
                MIP is based on LTV and score
 
 MONTHLY MI   90.01-95%             = .78                               .50%   * MIP is based on
                             85.01-90.01%        = .58                                            LTV and score
                             80.01-90.00%        = .49

How to figure it out:  Loan Amount x factor (.50%) divided by 12

BK                       4 years                                                         2 years

EMPLY               Same line for 2-years                                    2 years

ASSETS              3 months bank statements                             3 months banks statements

Must have enough in the bank for stated time period for Down payment (if purchase), closing costs, pre-paids and escrows.

GIFT                   5% must be own funds                                 ALL can be a GIFT

SELLER              LTV>90% = 3% of SP                                 6% of sales price
                             LTV<90% = 6% of SP

 

FHA mortgage loan calculation:  Sales Price x 96.5% x 101.5% (MIP)

Example:  $125,000 Sales price x 96.5% = $120,625 x 101.5% = $122,434