FHA Raising Down Payment for Utah Buyers with Low Fico Scores
FHA Toughens Down Payment Rules for Utah County Buyers
The Federal Housing Administration will raise the minimum down payment for its least credit-worthy borrowers, the agency announced Tuesday. The change is among a number of major changes the FHA is making to ensure its long-term financial soundness. Borrowers with credit-rating scores below 580 will be required to put down at least 10 percent. Most people with a fico score of below 580 don't have any money. This is a serious blow to people financially stuggling and want to buy a home in Utah. Those with a credit score above 580 will be able to continue to put down only 3.5 percent. The changes are intended to shore up the agency's finances.
The FHA also will increase its upfront mortgage insurance premium from 1.75 percent to 2.25 percent. The agency is expected to seek congressional approval to raise annual mortgage insurance premiums, paid by borrowers over the life of the loan, above the current 0.55 percent maximum. The amount it will seek has yet to be announced. I do not have the exact date these changes go into effect but the news is reporting sometime this spring.
Everyone hates to pay the mortgage insurance permium (MIP). This stinks! Raising the MIP a whopping 1/2 percent. I suggest those that have a low fico score buy before the Spring. If you have a low fico you may want to start saving 10% for your next home.
Paul Teasdale
Principal Broker
Team Teasdale Realty
Posted by Paul Teasdale - Utah Broker at 1/22/2010 4:01 PM 
Categories: Utah Market Conditions, Utah Lenders and Rates
Tags: utah county down payment FHA loan fico
Categories: Utah Market Conditions, Utah Lenders and Rates
Tags: utah county down payment FHA loan fico
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