The Department of Housing and Urban Development (HUD) has made plans to temporarily tighten its rules on FHA cash-out refinancings due to falling house prices and rising defaults on refis. 

Starting April 1, the loan-to-value ratio on a Federal Housing Administration cash-out refinancing cannot exceed 85% of the appraised value of the one-to-four family property, according to a HUD letter to FHA lenders.

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