FHA Could help Consumers with safe Mortgage Products

The NATIONAL ASSOCIATION OF REALTORS has stressed the need for the Federal Housing Administration to make changes to fill today's consumer demands.

Some changes that could be made: The FHA could provide borrowers with a safer alternative to riskier mortgage products that are on the market today. They could boost loan limits, eliminate the 3 percent minimum cash down payment, and give the FHA flexibility to provide risk-based pricing.

As sub-prime loans are being reevaluated and real estate markets have softened, a reformed FHA would be in the perfect position to offer home buyers better mortgage choice and help bring stability to local markets and economies.  

Increasing FHA mortgage loan limits would help first-time home buyers, minorities, and others who can't qualify for conventional mortgages. It also would help people living in high cost areas because the current low FHA limits make the program unusable.

Eliminating the 3 percent minimum down payment can also have positive results for many of these homebuyers.

If the FHA is strong and useful to today's consumer needs, it will help us return to a strong and vital housing market.