Virginia Beach Real Estate

President Bush signed into law today The Housing and Economic Recovery Act. This is the most sweeping change to housing reform since the New Deal of 1934. You need to write your Congressmen to see if we can get legislation to revoke some of the changes. FHA effective October 1, 2008 will increase the minimum required down payment from 3% to 3.5% for Virginia Beach home buyers. The legislation also calls for the elimination of seller down-payment assistance programs such as AmeriDream and Nehemiah by October 1, 2008.

As of July 14, 2008 they already made upfront MIP premiums risk based on credit scores but also increased the annual premium across the board.. Instead of the original plan of making FHA loans more affordable for potential Virginia Beach home buyers; the new legislation makes it more expensive.

High-level Details of the Housing and Economic Recovery Act:

Here are some key provisions of the Housing and Economic Recovery Act that most affect Virginia Beach home buyers:

1) Higher permanent loan limits for conventional conforming and FHA will become effective Jan. 1, 2009; the Act calls for limits to increase to a maximum amount of $625,500, depending on the metropolitan area. Note: The temporary limits established in March will expire on Dec. 31, 2008.

2) FHA floor limits will remain the same at $271,050.

3) The VA guaranty will increase.

4) Minimum cash investment for FHA loans will increase to 3.5%.

5) A moratorium on risk-based pricing for FHA loans will go into effect Oct. 1, 2008.

6) Seller-funded Down Payment Assistance Programs with FHA loans will be terminated Oct. 1, 2008. (Nehemiah, AmeriDream, etc.)

7) Condo processing for FHA loans will be streamlined.

Concerned how these sweeping changes will affect your ability to buy Virginia Beach real estate? give us a call, 866-222-0158 #550. We are glad to talk with you about your situation.

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