HR 6694 (Down Payment Assistance)

Here is the resolution that just passed the House Financial Services Committee and is next up for a vote on the house floor.  This could bring back down payment assistance programs.  Here is what the resolution proposes):

H.R. 6694 will reinstate FHA seller down payment assistance for persons with certain credit scores by establishing three classes of eligible borrowers:

- Those with FICO scores above 679 will be allowed FHA seller down payments under current HUD guidelines.

- Those with FICO scores of 620 through 679 will pay a risk-based mortgage insurance premium to cover their possible defaults in the amount of 3.0% of the original principal for a single premium AND 1.25% of the principal balance as an annual premium.

- Those with FICO scores of less than 620 who may be deemed as eligible by HUD for FHA seller down payments will be subject to HUD-established risk-based pricing.

H.R. 6694 will also create an on-time payment incentive based upon a refund of premiums paid in excess of normal premiums if the borrower makes on-time payments for a specific number of years and pays the mortgage obligation in full. If these requirements are met, the borrower will receive a refund in the amount of the difference between the amount normally paid and the amount actually paid.

Tags: down payment assistance, DPA, fha, Nehemiah | Category: Texas Mortgage News |