09/23/2024
Effective for FHA casefile numbers assigned on or after November 4, 2024 and announced in Mortgagee Letter 2024-13, FHA is expanding the 203(k) program which includes the following:
Limited 203(k) Updates
- Updated the total rehabilitation costs maximum from $35,000 to $75,000
- Extended timeframe for definition of ineligible “major” repairs
- Repairs that are expected to require more than 6 months expanded to 9 months
- Repairs preventing the borrower from occupying expanded from 15 days to 30 days.
- Extended timeframe for completion of repairs from 6 months to 9 months
- Now permitting the consultant fee to be financed.
Standard 203(k) Updates
- Changed the financeable mortgage payment reserve from 6 months to 12 months.
- Extended timeframe for completion of repairs from 6 months to 12 months
General 203(k) Updates
- Increased the 203(k) Consultant maximum fees for the following:
- Feasibility Study
- Work Write-Up
- Draw Inspection Fee
- Change Order Fee
- Reinspection Fee
- Mileage Fee
Pennymac is aligning with these changes. Refer to FHA Mortgagee Letter 2024-13 and FHA Info 2024-44 and 2024-59 for additional information and complete requirements.
Please contact your Sales Representative with any questions.