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Realtors and mortgage brokers have been utilizing FHA mortgage lending for the last few years. FHA guidelines remain tight in 2010 as DE underwriters are expecting higher credit scores for FHA mortgage loan submissions.
Many first time home buyers are using FHA home purchase loans to get approved to buy their dream home. HUD reported that February delinquent levels for 90 days late FHA home loans dropped from 9.4% in January to 9.2% in February. Many FHA enthusiasts saw this as a supporting indication that FHA lending programs were moving in the right direction.
According to the Mortgage Bankers Association the FHA loan product had a 3.57% home foreclosure rate in the fourth quarter of 2009. That’s lower than the 4.58% home foreclosure rate for non FHA loans. A few years back, HUD created the Neighborhood Stabilization Program (NSP) in an effort to eliminate the stress from regions that high home foreclosure rates and home abandonment. Through the purchase and redevelopment of foreclosed and abandoned homes and residential properties, HUD moves to stabilize the housing markets and local economies. HUD just announced that the definition of “foreclosure” will be expanded to include homes with FHA mortgages that are 60 or more days in arrears, and “abandonment “means the property has a mortgage at least 90 days delinquent.