Increasing Defaults: Federal Housing Administration Responds

FHA loans were created to offer the dream of homeownership to low and middle income borrowers and those in underserved communities. This dream has become a reality for many. However, with the credit crunch affecting all sectors of lending, the Federal Housing Administration has had to tighten their guidelines, as well.

The new FHA guidelines include:

• A rise in upfront PMI, mortgage insurance, requiring from 1.75% to 2.25% of the loan amount
• Borrowers with lower credit scores (below 580) will be required to provide a ten percent down payment, nearly triple the previous requirement

While FHA loans will still be largely accessible to many individuals that may not qualify for conventional financing, these new guidelines will make it a bit tougher for some to realize homeownership.

At Vanguard Funding, we underwrite and fund FHA loans. We stay up to date on all loan guidelines, particularly with FHA, and strive to match every borrower with the home financing option that is best for their situation. We make the process a pleasant one, with fees and costs disclosed up front and smooth, stress-free closings.

A good mortgage professional will be well versed on loan guidelines and available products. They will offer competitive pricing and streamlined closing. But an outstanding originator will educate you on your options and have a vested interest in making sure you make solid financial decisions for now and looking toward the future. Defaults are not in anyone’s best interest—not that of the lender, the borrower, or the market at large.

We will be happy to tell you more about the general guidelines for FHA loans, such as maximum loan amount, inspection requirements, and appraisal parameters. We can also let you know what other options may be available.

About Brian Ofsie and Vanguard Funding:

Focusing on a wealth of industry knowledge and set squarely on providing a superior customer experience, Vanguard Funding works with every client from application to closing to help them meet their financial goals, now and in the future.
Customers can count on:
• Low fees
• Low rates
• Fast closings
• Honest and upfront advice
• Superior service every step of the way
Come get the facts yourself and decide if Brian Ofsie is right for you. Give us a call today.