- As many of you know Feddie and Fannie have made changes to their guidelines surrounding second homes, investment homes and condos. This will have an impact in our market so please see the letter below from Amanda Doebler at FirstBank. FirstBank seems to be one of very few banks with the flexibility to continue with portfolio programs, this will be very important in our markets.
At this time FirstBank is not making any changes to our Conventional Loan offerings as they relate to second homes and investment properties. As you know, lenders are now limited to a 7% limit on conventional loans (30 Year Fixed non-Jumbo) for secondary homes and investment properties. The majority of FirstBank’s conventional loans are mainly tied to Primary Residences and at this time our current conventional loan portfolio as a company is within that tolerance.
As of today, if we were to receive a loan request for a 30 Year Fixed product for a Second home or investment property we would submit the loan to the conventional market as usual. At that time, if we are told that we are unable to move forward with a 30 Year Fixed product as we have reached our 7% capacity for second homes/investment properties we would then convert the loan to a portfolio product. While your clients may not end up with the loan product they preferred, FirstBank will always have a product available for them.
Some lenders have stopped accepting applications for secondary & investment properties altogether as far as their conventional products are concerned, at this time FirstBank has no intentions of limiting second homes or investment properties to Portfolio only products. That may change in the future if we approach our 7% capacity, but at this time we are making no changes.
We have no guidance as to whether any loans in process at FirstBank or with another lender could be impacted mid-process by this change. At this time we have not seen any impacts to our secondary/investment 30 Year Fixed loans in process but every lender appears to be handling this differently.
As we receive additional guidance I will be sure to keep your team in the loop with any changes to our product offerings as they relate to conventional 30 Year Fixed Loans for second homes and investment properties. Again, we will always have several portfolio loan products available for your second home & investment property clients, but we may or may not be able to move forward with a 30 Year Fixed rate depending on our capacity in relation to the 7% limit at any given time.
Please feel free to reach out with any questions.
