PMI Mortgage Insurance Co. has increased loan-to-values on several programs and expanded its guidelines.
The new LTVs apply in non-distressed markets.
On condominiums, LTVs are now 95 percent, according to a bulletin from the mortgage insurer.
Borrowers with 720 credit scores can get cashout refinances to 85 percent LTV and second-home financing up to 90 percent LTV.
LTVs up to 95 percent are available for construction-to-permanent loans to borrowers with 680 credit scores on loans up to $417,000, and the LTV is 90 percent for borrowers with 700 credit scores on loans up to $625,500.
PMI said it will now insure high-balance loans with 700 credit scores. It will even insure in distressed markets up to 90 percent LTV with a 740 credit score.
In Arizona, California, Hawaii, Maryland, Michigan, Nevada, New Jersey and Rhode Island — PMI will insure high-balance loans up to 85 percent as long as the borrower’s credit score is at least 740.
All of the expanded LTVs went into effect yesterday.
In addition — as of Jan. 1, 2010 — PMI will allow borrowers to use credit cards to pay closing costs.
Also next year, ownership requirements will be 90 days, and exceptions will be allowed to the property flip policy. Additional appraisal analysis guidelines have been added as well.
Other changes effective next January including limiting to 15 percent the 30-day delinquency rate on association dues for condominium projects; the elimination of trailing spouse income as an acceptable income source; and the addition of reserves to the verification requirement.
When business funds will be used for the down payment, a letter is required from the company’s certified public accountant indicating that the business won’t be negatively impacted by the use of the funds.
Another new requirement next year is that borrowers must have completed their credit counseling, established at least three current and active accounts with a 12-month history and had no late payments.
