FHA Policy Changes

California Real Estate November/December 2009
Official Magazine of the California Association of Realtors

Starting January 1, 2010, the Federal Housing Administration will adhere to new credit standards and appraisal guidelines for FHA-insured mortgages.  The new guidelines, which esentially align with HVCC rules, will prohibit the undue influence of appraiers, or the chooing of an appraiser, by mortgage brokers or commission-based lender staff.  In addition, the FHA's appraisal validity period will be reduced to four months for all properties including existing, proposed, and new construction.  The action also provides new guidelines allowing a second appraisal to be ordered in some instances including when a borrower switches lenders.

For more information, see www.hud.gov/offices/adm/hudclips/letters/mortgagee.