FHA Tightens Downpayment Rules for Borrowers
While these new rules will only affect buyers who want to get a FHA loan, they may set the tone for other lenders. Tuesday, the Federal Housing Administration announced it will raise the minimum down payment for its least credit-worthy borrowers.
Borrowers with credit-rating scores below 580 will be required to put down at least 10 percent. Those with a credit score above 580 will be able to continue to put down only 3.5 percent. The changes are intended to shore up the agency's finances.
The FHA also will increase its upfront mortgage insurance premium from 1.75 percent to 2.25 percent. The agency is expected to seek congressional approval to raise annual mortgage insurance premiums, paid by borrowers over the life of the loan, above the current 0.55 percent maximum. The amount it will seek has yet to be announced.
Visit the Summary of FHA Changes issued by the National Assn of Realtors, or contact me with any questions.
Sherry Armstrong, Realtor
386-679-3191
yourkeytothebeach@gmail.com