The U.S. House of Representatives today overwhelmingly passed the "Expanding American Homeownership Act of 2007," Here's what's in store if it passes the Senate:
- Allow FHA to make zero or lower down payment loans for borrowers that can afford mortgage payments, but who lack the cash for a substantial down payment.
- Double the current funding level for housing counseling for sub-prime home buyers and borrowers late on mortgage loan payments.
- Direct FHA to provide mortgage loans to borrowers at higher risk, but who are still qualified using prudent lending standards.
- Expand and improve the FHA reverse mortgage loan program by raising loan limits, removing the loan cap to avoid program shutdowns, and by reducing the maximum fee lenders can charge for these loans.
Real estate professionals and the public need to take this bull by the horns by notifying their senators that they expect them to make certain this legislation passes without being watered down.
Daniel and Derrick, thanks for your comments. I feel in my bones that it will pass...that is, it will pass if the Senate wants to remain a branch of the US government.
We'll hope.
Bill
Tom, you're right. I have to admit that I'm not too happy about FHA insuring 100% loans. One of the necessary realities of growing up is the need for financial discipline. Having no savings and borrowing, say, $200,000 to buy a $200,000 homes strikes me as a bad idea.
BILL