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New bill would increase mandatory
FHA mortgage down payment
Source: Informa Research Services
(05/27/2011) If
a bill recently proposed to the U.S. House of Representatives becomes law,
consumers who want a home loan backed by the Federal Housing Administration will
have to make a larger down payment.
Republicans recently discussed a bill at a House Financial
Services subcommittee hearing that would increase the minimum down payment
required for obtaining an FHA-backed home loan to 5%, up from the current rate
of 3.5%. This measure was introduced to the proposal, which hasn't been formally
introduced to the legislature, because the FHA has run low on funds due to the
foreclosure crisis.
Consumers
facing foreclosure may find that their home loans are more affordable after they refinance.
By checking the latest online rate tables to find the best local mortgage rates, consumers can save as much as a few hundred dollars a month on their
current home loans.
The
National Association of Realtors is among those who would protest the bill,
saying that if mandatory down payments rose to 5 percent, more than 300,000
consumers who would otherwise be able to obtain such a loan would be unable to
afford doing so.
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