The National Association of Home Builders (NAHB) is using the spotlight on National Homeownership Month to promote its backing of the reforms to FHA loans. NAHB was one of the many organizations who testified in favor of the reforms. The article points out two of the features of FHA reform that always goes unnoticed:

The bill would grant FHA greater flexibility in setting downpayment requirements for its single-family programs and establish a risk-based mortgage insurance premium pricing structure that rewards higher-risk borrowers who establish a track record of timely payments. The bill would also permit FHA to extend the maximum loan maturity to 40 years to enable borrowers to reduce their monthly mortgage payments and increase the current limit for FHA-insured mortgages to enable deserving potential home buyers to buy homes in high-cost areas.

The new flexible insurance and extended loan terms are two more ways that FHA reform could be an answer to the subprime crisis. All the support for National Homeownership Month is a great way for the message to get out.

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