seattle fhaSomeone actually said this to me today:

"FHA is the New Sub prime." 

Let it sink in for a minute - can you believe it? - FHA loans are back for the buyers who don't have a down payment.  I will be interested in watching this Seattle area trend to see if FHA really is the new sub prime.  For those of you who don't qualify for FHA, here is a post about ways to save for a down payment.

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6 Comments on Seattle Real Estate: FHA is the New Sub prime

APR
15
2008
I wasn't sure if I was reading a commercial or a blog.
12:43am • #1

Hi Courtney, yes I've heard it said and believe FHA is back...one reason is that FHA's minimum credit score requirements are lower than required for Prime and usually offer significantly better interest rates than Sub-prime.

So even with the upfront mortgage insurance premium and monthly MI required by FHA, generally payments are as-good-or-better than if using sub prime rates.

Another FHA positive is potentially higher Loan-to-Value limits compared to recently imposed LTV limits some lender programs have implemented.

I've checked the math and think FHA can make sense for some homebuyers in the current marketplace. .

 

 

2:57am • #2
243,897 Points 9 Featured Posts Localism Sponsor Outside Blog Hit Router

Shawn - not sure what you are talking about....

Teresa - thanks for all the good info.  It is so amazing to see all the trends that happen after a major shift.

8:23am • #3
2 Featured Posts

I am working with some 1st time buyers who have been told that FHA is the only way that they will qualify. If that does not say sub prime then I dont know what does. FHA has streamlined the process and they are fairly easy to work with so I do not mind using FHA for buyers.

Best,

Scott 

10:45am • #4
237,716 Points 56 Featured Posts Localism Sponsor Outside Blog
Courtney, I don't agree that FHA is the new sub prime. There are programs available for assistance with downpayment and also the gift act. With FHA insuring the loan, it seems that it is a far better option for any buyer rather than the old sub prime. Just my thoughts...
3:28pm • #5
APR
16
2008
1 Featured Post
With so many of the sub prime products going away, FHA is bound to get more popular.  I wonder what other parts of the country are seeing.
6:27pm • #6

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