FHA Raises Minimum Requirements

The Department of Housing and Urban Development has tightened its minimum standards, now requiring borrowers to have scores of at least 500 to qualify for FHA-insured loans. Until now there has not been a required a minimum score.

However, the practical impact of this move will be extremely limited since less than 1% of approved borrowers in the first quarter of 2010 were below 580; most loans went to borrowers with scores above 620.

"It really is just conforming FHA standards to what FHA lenders have already been doing," said Michael Fratantoni, vice president of research and economics for the Mortgage Bankers Association.

Janus Real Estate Group    *    Heather Anderson     *    972-765-3773