From Realtor Magazine Online, Daily Real Estate News April 4, 2008
Banks are adding fees and increasing interest rates on Federal Housing Administration loans that make the government-guaranteed mortgages less likely to assist their target customers.
Congress recently approved an increase in the ceiling on loans the FHA can insure to as much as $729,750 in the highest-cost areas, up from $362,790.
J.P. Morgan Chase & Co. is only one of the lenders saying it will charge at least a half-point premium and demand a minimum 580 credit score from borrowers seeking the FHA jumbos.
Kevin W. Lynch, a mortgage broker at A. Anderson Scott Mortgage Group in Rockville, Md., says he has been quoted rates of nearly 7 percent on jumbo FHA loans. The loans are so expensive they "aren't going to sell," Lynch says. "It's a waste of everybody's time."
Source: The Wall Street Journal, James R. Hagerty (04/04/08)
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