FHA to the Rescue!August 31, 2007
by Linda Hutchinson
President Bush is set to unveil a proposal today that will rescue select homeowners around the country with risky “sub-prime” adjustable rate mortgages who otherwise might their homes to foreclosure. According to the Florida Association of Realtors, the Federal Housing Administration will insure new loans for up to 80,000 homeowners who previously paid their loans on time and have a minimum of 3% equity in their home.There are too many foreclosures, pre-foreclosures, and short sales on the market in Central Florida already. These three types of listings tend to have a detrimental effect on the market as they drive down price expectations for buyers, flood the market with houses owned by unmotivated sellers, and lower the market price of otherwise desirable properties. This proposal promises to keep up to 80,000 homeowners in their homes by allowing them to refinance at a lower rate, which is good news for Realtors and homeowners, and great news for the real estate market!