So what would you say you do here?
By admin | April 24, 2007
Over the past decade the mortgage industry has advanced in ways we have never seen before. There is a faster, automated processing system and new innovative products offered to borrowers. While the rest of the mortgage industry was making these strides the FHA Loan program remained the same making them less of a choice to lenders and borrowers.
Because of the FHA’s inability to change with the times and the growing costs of living we have seem the volume of FHA loans drop across the country. In the city of Los Angeles alone they saw the volume drop from 1,603 loans in 2001 to a mere 5 loans in 2006.
The drop in the number of FHA loans has resulted in low to moderate income families turning to other methods of mortgage finance. These other methods are much more risky and have gotten many into trouble, thus the increase in foreclosures across the country.
Brian Montgomery, Assistant Secretary for Housing, had this to say.
“As the dynamic mortgage market passed FHA by, many homebuyers, especially those living in higher cost states such as California, New York, and Massachusetts, to name a few, purchased mortgage products with conditions and terms they would not be able to meet.”
Making policy changes to help these families is a top priority and has been discussed for quite a while. Some say change isn’t coming soon enough as the housing bubble has burst and many of these families should have been helped years ago.
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