Fed Study Says FHA Lenders Tighten Standards

A new report has been released by two Federal Reserve economists that suggest that the steep decline in FHA loans in recent months is due in part to a concerted effort by FHA lenders to reduce their exposure and improve profitability by rejecting applications by applying tough underwriting standards.  These strict underwriting conditions keep borrowers who can’t afford a large down payment out of the Federally guaranteed program that is designed to make it possible first time and mid to lower income applicants become homeowners.

You can read more about this report at: http://www.realestateeconomywatch.com/2014/07/fed-study-says-fha-lenders-tighten-the-screws-on-applicants/