It looks like FHA will continue to pumps up the Hope for Homeowners program to help distressed homeowners who have been unable to refinance. This FHA refinancing program continues to be questioned because millions of homeowners are facing foreclosure and yet still only a few have been able to qualify for this short-refinance program.  However, loan modification programs the alternative to refinancing, are more popular than ever, as lenders continue to renegotiate mortgage balances for troubled borrowers across the country.

But in the 2009 FHA loan limits are being reduced again.  FHA announced the new ceiling in the high cost markets will be $625,500. FHA mortgages in 2009 will cap out at 115% of the median home price in a county or metropolitan area. Still, many regions of the housing market will remain, as never before, eligible for FHA home loans.

o    FHA home loans can only be originated from a FHA-approved mortgage lender.

o    Down payment requirements are minimal. Buyers need only 3.5% of the house’s price tag.

o    The down-payment can be a gift from a family member, employer, local charity, or local government program.

o    FHA mortgage programs enable all ranges of credit scores with compensating factors

o    You must have a two-year employment record. The new monthly FHA mortgage payment must be less than 31% of your income, and debt to income ratio is usually less than 43% of your income.

Read the complete FHA Loan Article >.