Tuesday, January 26, 2010
1/26/2010 04:34:00 PM | Posted by
Arbor Mortgage
On January 20, 2010 the Federal Housing Administration (FHA) commissioner David Stevens announced a set of policy changes that will tighten the qualifications even further, making it even harder to obtain a government backed mortgage.
The first change to take effect will be the increase in mortgage insurance premium (MIP). The increase is to build up the agency’s reserves. On April 5, 2010, the premium will increase from 1.75% to 2.25% of the loan amount for single family programs with certain exceptions. This adds $500 to every $100,000 of mortgage loan to a borrower’s closing costs.
Another proposed change requires a minimum credit score for FHA’s 3.5% down payment program. If a buyer has less than a 580 credit score, a down payment of up to 10% may be necessary. According to the Department of Housing and Urban Development (press release HUD No. 10-016), “This change will be posted in the Federal Register in February and, after a notice and comment period, would go into effect in the early summer”.
The first change to take effect will be the increase in mortgage insurance premium (MIP). The increase is to build up the agency’s reserves. On April 5, 2010, the premium will increase from 1.75% to 2.25% of the loan amount for single family programs with certain exceptions. This adds $500 to every $100,000 of mortgage loan to a borrower’s closing costs.
Another proposed change requires a minimum credit score for FHA’s 3.5% down payment program. If a buyer has less than a 580 credit score, a down payment of up to 10% may be necessary. According to the Department of Housing and Urban Development (press release HUD No. 10-016), “This change will be posted in the Federal Register in February and, after a notice and comment period, would go into effect in the early summer”.
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- Arbor Mortgage
- Arbor Mortgage is a Michigan based mortgage lender that has been providing mortgage solutions for more than a decade. Since 1998, Arbor Mortgage has helped more than 20,000 people purchase or refinance their homes. Arbor offers a variety of mortgage programs including FHA, USDA Rural Development, VA, Conventional and Alternative loans.
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