By Dean Tucker, Waterstone Mortgage - Prime Equity Group in Boise Idaho
This week our industry lobby group met with staff for the Housing subcommittee in Congress to discuss our concerns regarding the Rural Housing guarantee program, and the imminent shortfall in funding authority. This follows up our letter to Congress of last week.
Here are the key points:
- Members of the Committee understand the issue and want to resolve it.
- There is no support for a supplemental appropriation -- (i.e. additional spending bill). Congress is "spent out", and there simply is no major spending bill on the horizon to which an RHS amendment might be added.
- The Committee appears open to a resolution in which the guarantee fee would be raised -- perhaps to 3.5% from the current 2%. While this would add costs, the advantage would be that it would allow the program to operate self sufficiently without having to go back to Congress again.
- The sudden increase in the use of the RHS program is drawing scrutiny, including concerns by the administration about the zero down-payment feature of the program. There is concern that RHS is becoming a backdoor way to get around FHA in some areas. While this does not mean the administration would oppose self funding for the program, they may want to tie it to new program restrictions.
Real Estate professionals' feedback and reaction to the prospect of an increase in the guarantee fee, as well as any other comments you may have are very welcome and encouraged. Please respond to this blog post below.
I specialize in home loans for first time home buyers, move up buyers, second home purchases, and resort lending. The loan products available to my clients include FHA, IHFA, VA, Conforming Conventional, Jumbo and Super Jumbo Portfolio.
My primary markets are Ada County (Boise, Eagle, Meridian, Kuna, Star), Canyon County (Nampa, Caldwell, Middleton), and Valley County (Cascade, Donnelly. Tamarack, McCall).
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