Is FHA Making It Easier to Qualify?

Is FHA Making It Easier to Qualify? | Jim Catalano

The answer is YES.

Due to recent policy changes at the Federal Housing Administration (FHA), lenders are likely to begin approving more loans. Many loans declined in the past because of more stringent guidelines could now get loan approval.

The organization’s mandate is to increase homeownership levels. In the past, lenders were more strict on guidelines fearing hefty penalties and severe reprisals from FHA due to mistakes on loans or approvals on less than perfect borrowers.

To overcome this FHA announced that it would not penalize lenders when loans went through with minor errors that had no bearing on credit approval. FHA hopes this will encourage lenders to be more willing to approve loans.

According to Ellie Mae, a mortgage software company, about one-quarter of all mortgage applicants will apply for an FHA loan due to the more buyer-friendly guidelines.

As we approach another busy spring home buying season in Texas, this could not come at a better time. Interest rates are near all-time lows, and low home inventories across many areas of Texas will make for a competitive market.

If you are in the market to purchase this spring or summer, I encourage you to start now with obtaining your loan approval. Getting your loan approval completed before you begin shopping for your home will help you in the following ways:

  1. Give you peace of mind.
  2. In a competitive market where there are multiple offers, your offer will rise above any offers that still require loan approval.
  3. Helps you and your real estate agent know what fees can be negotiated with the seller.
  4. You can lock in your interest rate if it becomes necessary.

Let me help you accomplish your mortgage financing goals.

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