The Federal Housing Administration announced yesterday that FHA loan requirements are changing and tighter restrictions for FHA-backed loans will go into effect this year. Colin Robertson over on Mortgages Unzipped wrote a blog post on the changes to FHA-backed loans.
The changes are relatively small for most borrowers:
- The upfront mortgage premium (MIP) will be raised from 1.75% to 2.25%.
- For borrowers with credit scores under 580, the minimum down payment will rise from 3.5% to 10%.
- Allowable seller concessions will be cut in half.
These changes are expected to be implemented this spring or summer. Read more about why the FHA made these changes.