In the midst of a refinancing boom, Bank of America has decided to suspend all cash-out refinancings on FHA and VA loans, according to a product update notice provided to National Mortgage News.
The troubled bank also will no longer fund 3/1, 5/1, 7/1, and 10-year ARMs insured by the Federal Housing Administration and Veteran Administration.
The suspension of these – and other products – became effective Sept. 19 and applies to all of the bank’s retail mortgage platforms. It only applies to non-portfolio loans.
It’s unclear whether the suspensions apply to the bank’s correspondent division, which is on the auction block. Early Monday morning two spokespersons for the bank did not reply to a telephone call and emails.
The bank has told its retail staff the suspensions are due to “our commitment to focus on application volume that we can acceptably process and close on time…”
In the notice, B of A refers to the suspensions as temporary.
Also on the list of suspended loans: manufactured homes, and what it calls “unique property types,” which include log homes, and earth and berm homes.
