From this weekend’s Times real estate section: “Loans insured by the F.H.A., an arm of HUD, protect lenders from losses, thereby encouraging them to provide financing to those who might otherwise be refused a mortgage. These loans are typically 30-year fixed-rate products, but they require only a small down payment, as low as 3.5 percent — significantly less than the 20 percent standard of recent months. Often, the loans are made to people who don’t have perfect credit scores.” The article says the loans now account for a quarter of all mortgages, up from 2 percent only 3 years ago. Although they often serve borrowers with less-than-stellar credit, they’re considered solid because people receiving them must have verifiable income and jobs. The loans cap out at $729,750 here in New York, and condo developers who want to offer them have to “meet a variety of financial, structural and environmental standards and restrictions.” As we covered a couple weeks ago, an East Williamsburg condo that offers F.H.A. loans is seeing brisk sales.
F.H.A. Loans Help Sales [NY Times]
Nondescript East W’burg Condos Defying the Market [Brownstoner]
On the Other Hand: Chase Pushing FHA Loans [Brownstoner]