Our national priority is to "Fix Housing First" and insure that never again will homeowners be lured into enticing but dangerous loans.  Having a home is important to people but it must be affordable and must be responsibly financed.  In plain English, this means good candidates for home ownership right now are people with steady income, good credit, and down payment funds in hand.  FHA recently made two announcements to facilitate these goals.

FHA Great News:  Loan amounts have been increased by HUD in many areas!  In the Denver metro area, the new limit is $406,250.  This means the benefits of FHA (lower down payments, lower credit score requirements, make-sense underwriting, etc) will be available to more homebuyers!   (note: this number is not right)  This new higher FHA limit means that a qualified buyer with a 3.5% down payment could finance a home up to this amount.

FHA Not Great News:  Minimum credit score requirements.  Most of the major FHA lenders will be requiring a 620 credit score starting 3/2/2009.  Recently, the minimum credit score has been 580.  For first time home buyers hopeful of using the $8,000 home buyer tax credit good through December 1. 2009, this means some quick analysis of the credit report is in order.  While major credit score killers like bankruptcy, foreclosure, repossession, and a long history of delinquent payments can't be fixed quickly, some other areas can be  improved in the short term.  A person can make sure that all information on the report is correct, make sure payments are on time, and pay down credit cards so that only 30% of the limit is in use. If a potential homeowner takes these steps, he might be able to improve his score by 30 points in a few months - a good move for qualifying for financing from FHA or any other lender.

Our BandyHomes website has many helpful tips for buyers, as well as many affordable properties in Aurora.

Marianne Bandy

Relocate to Denver