Question:

What is the home loan subordination policy in Florida?

Answer:

As of September 2004, the following subordination policy items have to be considered for a home loan subordination to take place in Florida:

  • Only one home loan subordination is allowed per borrower per loan;
  • Reason of loan subordination is usually a refinance transaction;
  • The new interest rate has to be compared to the initial rate;
  • Cash-out refinance is not allowed except for critical home improvements and repairs;
  • 1 year seasoning is required;
  • No additional debt can be included in the refinanced mortgage except amounts needed for home improvements;
  • Mortgage loan subordination requests must be submitted at least some 10 days prior to the new mortgage closing date.

Florida Subordination Policy Paperwork

  • Subordination Request Form & Comparative Analysis (completed)
  • Verification of residency
  • Personal Financial Statement/Worksheet of the borrower
  • Fannie Mae 1008 Loan Transmittal Form
  • Current Appraisal to support new loan
  • Inspection Report (only if home improvements will be needed)
  • Preliminary HUD-1 Settlement Statement (copy)
  • Good Faith Estimate (GFE) (copy)
  • Title Insurance (copy)

Loan subordination request will cost around $50 processing fee.

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