Subprime Debt Insured by FHA Climbs in Bet on Housing Recovery: Mortgages

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FHA News Editor - Here we post articles each week on FHA/VA Government news.

In Honolulu, on the southern coast of the island of Oahu, there’s a four-bedroom home priced at $785,000 that has views of the sun setting over the Pacific Ocean. The beaches of Waikiki are 15 minutes away. Starting this month, the property is available to buyers with a subprime credit score, limited cash reserves and a 3.5 percent down payment using a loan backed by the Federal Housing Administration. Without the agency, a buyer would need a 20 percent down payment and an unblemished financial history for a jumbo mortgage. The FHA is betting housing can recover enough to expand financing and earn bigger fees to revive its record-low capital levels.

To read the entire article, please visit:
http://www.bloomberg.com/news/2012-01-26/fha-increases-subprime-debt-ins...

SOURCE: Published by NAMU® Publishing Group, a division of the National Association of Mortgage Underwriters (NAMU) (http://www.mortgage-underwriters.org)