The Federal Housing Administration (FHA) has announced a set of policy changes to strengthen its capital reserves and manage its risk.
The FHA’s proposals includes:
- increase the mortgage insurance premium (MIP)
- update the combination of FICO scores and down payments for new borrowers
- reduce seller concessions to three percent, from six percent
- implement a series of significant measures aimed at increasing lender enforcement
See the entire announcement here: FHA Announces Policy Changes to Address Risk and Strengthen Finances
Of note, 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%.