The FHA announced yesterday that they are changing several of their loan requirements. Here are some of the changes they are implementing.
Mortgage insurance premium (MIP) will be increased by 50 bps to 2.25% and they are going to request legislative authority to increase the maximum annual MIP that the FHA can charge.
New borrowers will now be required to have a minimum FICO score of 580 to qualify for FHA’s 3.5% down payment program. New borrowers with less than a 580 FICO score will be required to put down at least 10%. This change will go into effect in the summer.
Reduce allowable seller concessions from 6% to 3%, This change will go into effect this summer.
These are the changes that most directly will affect you, whether you planning on buying or selling a home. If you are buying, it may be more difficult to qualify for an FHA loan. If you are selling, your buyer may find it harder to get a loan if they are going through the FHA.
More information on these new changes can be found in this article. (opens in new window).