FHA Announces Policy Changes to Address Risk and Strengthen Finances

Congress approval to change FHA’s guidelines has not been granted, however it is expected that they will support these changes.  HUD has not released a Mortgagee Letter or an official press release. 

Summary of changes to take effect Spring/Summer 2010:

• Increase up-front MIP to 2.25% across the board
• FICO scores < 580 will require 10% down and seller concession of no more than 3%
• Increase monthly/annual MIP premiums
• Decrease seller contribution limit to a max of 3%

via U.S. Department of Housing and Urban Development (HUD).