According to an article published in The Wall Street Journal on Tuesday, the FHA is making good on its promise. It suspended Home Mortgage Inc. for six months and pulled the licenses of three other lenders, Strategic Mortgage Corp., ProMortgage Inc., and Americare Investment Group Inc. The FHA said that Strategic Mortgage Corp. and ProMortgage did not uphold the FHA’s loan standards, Americare violated previous settlement terms, and Home Mortgage was suspended for failing to disclose an owner’s indictment. You can read the full article here.

Present Value is an FHA certified appraisal company. 

By: Present Value

This week, The New York Times published an article discussing the effect that FHA loans currently are having on home sales. The article says that three years ago, FHA-insured loans made up 2% of the market and now, 25% of the market is backed by FHA-insured loans. That’s a huge jump in a very short amount of time. Clearly, the FHA’s plan to help potential buyers secure financing is working.   

Traditionally, FHA-insured loans were obtained by people with less-than-perfect credit scores. Banks were more comfortable lending to riskier borrowers if the loans were insured by the government because the bank would be protected from a loss should the borrower default on the loan. But because financing is so difficult to secure right now, people who would have gone after a conventional loan in the past now have to look into FHA-insured loans to receive the financing required to own a home. To read the full article and see how this trend is affecting New Yorkers, click here.

By: Present Value