FHA Loan Guidelines ARE Changing.... Post Updated 2-5-10
According to a New York Times article posted January 19, 2010 FHA is expected to announce changes to the popular mortgage program. An FHA loan is a type of mortgage loan that is insured against loss by the Federal Housing Administration. It traditionally allows a lower down-payment requirement and a larger seller assist amount than conventional loans currently offer. Although FHA is not restricted to 1st time buyers, the loan program is widely popular with 1st time buyers who don't usually have the larger down-payment required by conventional loans.
Highlights of the possible changes as stated in the NY Times article:
Higher upfront mortgage insurance premium from 1.75% to 2.25%.
Lower seller assistance amount from 6% to 3% of the purchase price.
A minimum credit score of 580 for borrowers wishing to take advantage of the low down-payment amount of 3.5%.
If you are thinking about buying your first home, now is the time before these changes are put into effect. If now isn't the best time for you, don't fret. There are 1st time buyer programs available to help fill the gap FHA is surely leaving by lowering the allowable seller assistance amount. Contact me for a list of available programs.
Read the full NY Times article: http://bit.ly/7rPCcg
Update on 2-5-10
The changes to FHA as noted above have been officially announced. The new allowable seller assist amount of 3% will take effect in early April 2010. Check with your mortgage professional about how this may affect you. If you are not already pre-approved for a mortgage, please feel free to contact me for some recommendations to local professional who can assist you.
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Kelly Gidzinski
Keystone Property Connections, LLC
www.Kelly.GreaterPhillyAreaHomes.com
www.YourLifeMoves.com