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The 1974 Real Estate Settlement Procedure's Act is undergoing potential changes by HUD. HUD views the revisions as necessary if consumers are going to continue to benefit from FHA financed mortgages.
Once a popular loan vehicle providing financing for more than 122,000 buyers in 1999, the financing has fallen to a dismal 5,000 in 2005. HUD desires changes to remove excessive home inspection and repair requirements, increase loan limits and reduce cash requirements.
Historically, FHA has been an excellent lending tool for First-Time Buyers or those with credit blemishes. FHA traditionally allowed for consideration of credit issues and would lend to borrowers who had not acquired a long credit history.
While changes will not happen quickly, the agency has indicated its interest in facilitating President Bush's push to create home-ownership opportunities for minorities.