FHA is putting a squeeze on buyers wallets

Beginning October 1, 2008 FHA, Federal Housing Administration will increase it’s minimum down payment amount for loans from 3% to 3.5%.

On a $200,000 home this would be an additional $1000 down to a buyer.

Is this a concern to buyers, lender and REALTORS?

FHA has tighten it’s guidelines in the last couple of years.

Will this squeeze some buyers out of the market?

FHA will also no longer allow charities to provide down payments or down payment assistance to buyers. I know that in 2004-2006 many buyers used charity assisted down payments in order to purchase homes. 

This could put a pinch of some buyers, that may not be able to qualify for a loan without this type of assistance.

Only time will tell if these new “adjustments” to FHA guidelines will affect buyers.

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