FHA Revokes Credit Dispute Rule

FHA Revokes Credit Dispute Rule

In April, we posted about the proposed Federal Housing Administration (FHA) rule that would have prevented home buyers from getting FHA backed (insured) mortgages if they had an ongoing credit dispute exceeding $1,000. In that post, we reported that the FHA had elected to delay enforcing the rule until July.

Realtors, mortgage professionals and potential home buyers will be happy to hear that the FHA has now elected to revoke the controversial rule altogether. The rule faced serious objections from housing finance professionals.

“FHA killing off the rule is not a surprise when you take into account the resounding objection from the housing finance community and their concern that this would overly constrain credit,” Edward Mills, senior vice president at FBR Capital Markets, told HousingWire. “This action shows how it can be incredibly difficult to make choices that move towards protecting the insurance fund over keeping mortgage credit available.”

Opponents to the rule felt that it would have the greatest impact on young, first time home buyers who may be looking to take advantage of high home affordability and historically low interest rates.

View the FHA Mortgagee Letter 2012-10 detailing this rule revocation here.

With this hurdle to home ownership no longer a pending obstacle and rates still hovering below 4 percent  – homeowners should consult a mortgage professional to learn more about the loan programs Inlanta Mortgage offers. Afterall, now is the time to buy! Click here to locate a licensed mortgage professional near you.

Inlanta Mortgage offers Fannie Mae/Freddie Mac agency products, as well as a full suite of jumbo and portfolio programs. The company is fully delegated HUD-FHA including FHA 203K, VA, and USDA approved. Inlanta Mortgage also offers numerous state bond agency programs. Review Inlanta’s mortgage loan programs.

Inlanta Mortgage is a multi-state mortgage banker based out of Brookfield, Wisconsin. NMLS# 1016. Inlanta Mortgage is proud to be a recent recipient of a 2012 Top Workplace Award.