Article
...F.H.A. requires down payments of only 3.5 percent and has less stringent credit requirements than conventional mortgages...“Just about anyone that is putting down less than 20 percent needs to consider F.H.A. financing,” said Joe Rogers, executive vice president of Wells Fargo Home Mortgage. “That doesn’t mean they need to take it, but they should consider it.”...In 2005 and 2006, at the height of the housing boom, only 1.8 percent of all mortgages were F.H.A.-backed, according to Inside Mortgage Finance. Last year, that number ballooned to 17.1 percent. The F.H.A. now insures 4.8 million single-family mortgages worth about $550 billion...your payments, including taxes and insurance, should not exceed 31 percent of gross income. When you include car payments, student loans and other obligations, your total debt shouldn’t exceed more than 43 percent of gross income....people with credit scores below 500 must have at least 10 percent of equity in their home to be eligible. (The average F.H.A. borrower has a score of 640.)...to keep default rates down, many F.H.A.-approved lenders have recently started to impose their own credit score minimums — above and beyond the F.H.A’s. guidelines — and are requiring more stringent income documentation...“In the last month and a half, there has been a dramatic increase in the minimum credit score required,” said Michael Moskowitz, president of Equity Now, a New York mortgage lender that makes F.H.A. loans [Equity Now has for years been a very heavy advertiser on New York City's all-news radio station WCBS, as just about anybody who drives a car in the Tri-State region and depends on WCBS for traffic reports as I do will know!]. “Some went to 580 and others went to 620.”...borrowers with credit scores less than 700 with less than 20 percent in home equity often come out ahead with F.H.A. loans....Moreover, the F.H.A. is more reluctant to foreclose on its borrowers. It has said that borrowers in default get to keep their homes about 65 percent of the time. “They do not foreclose as quickly or without a thorough vetting of the situation,” Mr. Councilman said...
Regulars here probably know much of this, certainly Shane and Dallas do. But I'll bet many NY Times readers know very little about FHA loans; certainly when my wife and I bought our condo in 2002 FHA was not on our radar screen.
TU 791 02/11/2013, EQ 800 1/29/2011 , EX Plus FAKO 812, EX Vantage Score 955 3/19/2010 wife's EQ 9/23/2009 803
EX always was my highest when we could pull all three
Always remember: big print giveth, small print taketh away
If you dunno what tanstaafl means you must Google it
