In case you missed this in the news, FHA is putting up hurdles for higher-risk borrowers to get their Boston condo loan application approved.
In a sense, the agency is going back to basics. There’s been an uptick in higher risk loans getting into its insurance fund, and it wants to take action before problems appear. “Continuing to endorse mortgages with higher risk characteristics, without changes, negatively affects the Mutual Mortgage Insurance Fund,” the agency says in its memo announcing the policy
To be sure, many applicants won’t get approved for a loan now. But for others, it just means the decision will take longer.