Representatives of the Bush Administration reportedly were actively debating this week whether to loosen FHA’s underwriting requirements in order to permit more troubled subprime borrowers to refinance into more affordable fixed-rate FHA loans.
According to reports, the talks revolve around the FHA’s current underwriting requirement that borrowers can’t have missed a loan payment in the previous six months, regardless of whether they are current at the time of applying for a new FHA mortgage. It was unclear whether the administration’s latest mortgage relief initiative would be channeled through FHASecure or the regular FHA mortgage program.
