The guidelines for new Kansas City mortgage loans are changing - By negotiating a short sale, a Kansas City home seller can cut the time needed to wait to obtain a new mortgage loan.

The guidelines for new Kansas City mortgage loans are changing. Everything we take for granted about home mortgage loans (and being a Kansas City home owner) is being debated now in Washington D.C.

Its clear that the required down payments on mortgage loans will increase along with other key elements that many of us have taken for granted. For example, there is growing support to eliminate the mortgage interest tax deduction. There are also political rumblings behind getting rid of the ‘As American As Apple Pie’ 30 year mortgage and replacing it with a 15 or 20 year term. All of these changes will either increase the down payment needed to buy a home or the monthly mortgage payment.

Already a new approved guideline, the new QRM (Qualified Residential Mortgage) rules will be in full effect April 2012. Why is it important to know about the QRM rules? It is widely believed that the QRM rules will force minium down payments to increase to 20%. As Fannie Mae and Freddie Mac are ‘scaled down’ and their continued roles in the mortgage markets are in flux expect lots of heated debate about mortgage requirements. Stay tuned and be vigilant.

The question remains, given today’s guidelines what are the absolute bare-minimums to obtain a Kansas City mortgage loan?

….and perhaps more interesting…how to obtain a mortgage immediately after a Short Sale..read on…

By far the easiest mortgage to obtain is a FHA loan. Here is what is needed:

1) The home buyer needs a 3.5% down payment, based on the purchase price of the home (e.g., $7,000 on a $200,000 home), or a gift of that same amount;

2) The seller can contribute 3% - 6% of the purchase price, on top of the down payment, for closing costs, or a credit from the seller of the same amount; and

3) The buyer's credit score can be as low as a 640 FICO credit score — the middle score of those generated by the three credit bureaus (some banks will lend to borrowers with middle scores lower than 640, but will require more than the minimum down payment).

Mortgage lenders will want you to document income, asset and job history documentation, current paycheck stubs, two months’ bank statements and two years of W-2 forms or tax returns, and:

• a minimum of two years have passed since the discharge of a bankruptcy;
• a minimum of three years have passed since a foreclosure;
• anywhere from zero to three years have passed since a short sale, depending on the circumstances surrounding the short sale.

By negotiating a short sale, a Kansas City home seller can cut the time needed to wait to obtain a new mortgage loan. 

RE/MAX sells more homes than any other real estate company.
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Blog post written by the Dowell Taggart Team of RE/MAX Premier Realty 

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