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Does HERA eliminate the existing percentage limitations on financing?

April 26, 2017Eliminate existing financing hera limitations mortgage rates PERCENTAGE

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Does HERA eliminate the existing percentage limitations on financing?

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A. Yes. It permits financing of up to 100% of the appraised value of the property. Q.7. Can the amount of the mortgage be increased above 100% of the appraised value, by the amount of the mortgage insurance premium? A. No. The maximum amount of mortgage cannot be increased by the amount of the mortgage insurance premium when the principal obligation to be insured equals 100% of the appraised value. The premium can be financed as long as the principal obligation does not exceed 100% of the appraised value. Risk Based Premiums Q.8. Does this new law prohibit risk-based premiums? A. Only temporarily. It prohibits HUD from taking any action to implement or carry out a risk-based premium program for a period of twelve months beginning on October 1, 2008. Q.9. Do lenders have to stop using risk-based premiums immediately? A. No. FHA will insure loans using risk-based premiums through September 30, 2008. Q.10. What action must be taken to ensure that a risk-based premium loan will be insured