I want to make you aware of potential changes in FHA that may affect us all. For years borrowers have used Down Payment Assistance (ex.Nehemiah) as a way of satisfying FHA's requirement of having 3% in the transaction. However, thanks to the House and Senate, we will no longer be able to do this. The highlights of the bill are below.
· Seller participation in down payment assistance loans is being terminated. Must have obtained credit approval prior to October 1st.
· New Risk-based pricing moratorium is effective October 1 (risk based MI that rolled out 7/14/08 will be suspended for 1 year)
· Proposed Downpayment requirement of 3.0%-3.5% (gifts from family, bond programs allowed)
· House is expected to begin debate and possibly vote on Wednesday (July 23rd) on the final version of the omnibus housing bill
· The Senate could vote as early as Friday on the final bill with the President signing shortly thereafter (possibly early next week).
Stay tuned...
