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FHA REFORM PROPOSED

By
Real Estate Agent with Renaissance Realty Group of Keller Williams Atlanta Partners

Last week the House Financial Services Committee put forth a "discussion draft" on FHA reform.  The draft has a number of good provisions (providing increased lender enforcement, other risk avoidance tools, etc).  However, there are several provisions that I STRONGLY oppose.   

The first would raise the FHA downpayment for all borrowers to 5%, and prohibit the financing of all closing costs and the Upfront MIP. 

The second would change the whole calculation of the loan limits by making it 125% of median home price by county.  It would eliminate the MSA rule - which raises all counties within an MSA (metropolitan statistical area) to the highest limit in that area, and it would eliminate the FHA floor of $271,050 (which means low cost counties would go to 125% of median - under $100k in many areas).  It would make the high cost limit $625,500. 

It is very important to note that this is a "discussion draft" - not legislation yet. 

The bill also includes the issue of moving Rural Housing to HUD. 

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If you or someone you know is thinking of buying or selling a home have them give me a call .. we will get it done ...right 

Eric Reid 

Associate Broker

Keller Williams Atlatna Partners
Team Leader 
Renaissance Realty Group

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