by Preston Howard – Rose City Realty, Pasadena CA
It was bound to happen. With all the talk of financial reform being discussed throughout the halls of Capitol Hill, it was only a matter of time before it eventually affected popular government programs such as those provided by the Federal Housing Administration (FHA).

Today, the House passed its version of the FHA reform; now, it is on the Senate to vote on their version of the bill. Where the rubber meets the road is determining exactly how the new legislation will affect the housing industry and the buyers who rely on FHA programs to make purchases happen, when they may not have the financial resources for a 20% down payment.

Previously, the monthly FHA mortgage insurance premium was .55% of the loan amount. Now, it has essentially tripled to 1.55%. Many within the FHA claim that this additional premium will help to strengthen the Administration’s balance sheet while building additional reserves to guarantee more loans and reduce long-term costs for borrowers.  Others would argue that present borrowers’ monthly expenses will rise and make it harder for others to qualify.

Continue reading…http://www.brokeragentsocial.com/article/798/fha-reform-is-here-now-is-it-good-or-bad