When we were uncertain if the homebuyers could handle the FHA increased downpayment from 3% to 3.5% last year we now have new information that FHA may increase their downpayment requirements from 3.5% to 5% according to a bill introduced to Congress last month. Now when FHA is playing a larger role in financing and insuring new home mortgages, this also poses a higher risk in the current marketplace. FHA has decided in a statement released September 18th that it will tighten its credit and appraisal requirements. During this time there has been an increase in first time home buyers purchasing homes the potential increase in downpayment can deter those prospective buyers from moving further in their pursuits due to lack of funds. This particular bill also proposes prohibiting buyers from rolling their closing costs into the balance of their loan, requiring more out of pocket costs for the buyer. This bill has yet to be approved and will require final approval from the House of Representatives before being passed. As information changes and is updated I will continue to keep you posted on this issue. If you have any Real Estate related questions or would like to be put in touch with a lending partner, give us a call.
The Jen Team-
480-980-2677
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