Expanding American Homeownership Act Passes

September 18, 2007

time-to-celebrate.jpg& Cuts Rate!

It’s TIME TO CELEBRATE!!!  Within the last few hours, the Federal Reserve Board slashed rates followed by the great news that NAR’s tireless efforts to pass House Bill 1852 (also known as the Expanding American Homeownership Act) has passed!  And no, it’s not my birthday, my anniversary or even a fun Friday, it’s just a critically important and historical day!  When you’re old, you’ll be able to say “sonny, I remember when I found out that the fed cut rates and house bill 1852 were passed all in one day.  There were parades in the street and we all wore funny hats.”

Y’all know we here at Single Pointe loooove talking about Real Estate, but I’ll spare you the bore.  We know what you want, so here is what HB1852 means to you:

  • The FHA (Federal Housing Administration which is a government agency who insures residential mortgage loans) now has a loss mitigation program which allows mortgage term alterations so borrowers can be put in a more affordable situation and avoid default. 
  • The new bill allows “partial claim” programs in which FHA lends the borrower money to cure the loan default. No interest due on this partial loan until the property is sold or paid off.  This means less foreclosures and a healthier market.
  • The BEST news is that there is no more government required financing of 3% for your down payment into your mortgage amount.Previously when buying under FHA many would finance the required 3% down and this is no longer necessary.  You’re free to put as much or as little down as you see fit.  This opens that 3% up to be used on things like further buying down rates, payment buydowns, upgrades, & more. 
  • This bill also allows for more flexibility to provide risk-based pricing.  Yeehaw! FHA has always been pretty tight with this and the new House Bill gives them more room to stretch.
  • Loan limits have been increased which allows people in high-priced markets to qualify for FHA loans that have previously been denied due to the price of the home they were purchasing.  Good news to all of you looking to live near downtown Austin- SoCo, here we come!!!

So, here’s a toast to you buyers and sellers- congratulations, today is a big day!

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P.S: the image is NOT of a person on the Single Pointe web team.  We think this dude is from Ireland (or… maybe England).

Posted by Lani, Asset Director | Filed Under Austin News, Blog, Market Conditions 

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