Tuesday, November 22, 2005

FHA Loans With Down Payment Assistance Need Watching

The U.S. Government Accountability Office (GAO) reported that almost half of all FHA mortgages issued for single-family houses in 2004 had some sort of downpayment assistance.

GAO is concerned about statistics showing that loans with downpayments assistance having a higher delinquency rate, especially those involving seller assistance. It recommends that FHA establish tighter controls to address these concerns, especially for seller-assisted loans.

The report, called Mortgage Financing: Additional Action Needed to Manage Risks of FHA-Insured Loans with Down Payment Assistance, can be accessed online at
GAO.


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