SENATE PASSES FHA MODERNIZATION BILL
Homeowners across the country score a victory with the passing of the Dec. 14 approved legislation designed to modernize the Federal Houseing Adminastations mortgage insurance program. By increasing Loan limmits borrowers that are currently in sub-prime loans may be eligible to refinance into federally insured mortgages.
The bill, which has the support of the Bush administration, also would reduce the required minimum down payment for an FHA-insured loan from 3 percent to a flat 1.5 percent of the appraised value of a home.
The House passed a separate FHA overhaul measure in September, but there are several differences between it and the one passed by the Senate. The House bill, for example, would increase the FHA loan limit to $729,750, or 175 percent of the Conforming Loan Limit. The House bill also is pushing for a 0 percent minimum down payment, compared with the Senate's 1.5 percent. The house bill would allow risk-based pricing for FHA mortgage insurance premiums, while the Senate version opposes it. Both bills would categorize all condo units as single-family units.
Both the House and Senate measures will now be carefully scrutinized by a conference committee for comparisons and reconciliation of their differences. Once a final bill can be crafted, it will be sent to the President for signature.
I suggest that everyone contacts their Senator and ask for thier support in pushing forward the finalized bill with the highest loan limmit possible.
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