Whats in the bipartisan bill?
Modernize the FHA: Measures in the bill would overhaul the Federal Housing Administration’s loan insurance program, which helps homebuyers with weak credit or little cash get an affordable mortgage. The changes proposed in the bipartisan bill would raise the FHA loan limits from 95% of an area’s median home price to 110%. But in high-cost areas, the FHA loan limit may not exceed $550,000. Under the bipartisan economic stimulus package passed in February, the cap for FHA loans in high-cost areas was temporarily raised to $729,950. The Senate package also calls for FHA loan down payment requirements be raised to 3.5% from 3%. Help for troubled borrowers trying to refinance: The bill lets states offer $10 billion in tax-free municipal bonds, the proceeds of which would be used to subsidize mortgage refinancing for subprime borrowers trying to get out of unaffordable loans. Under current law, state and local housing agencies are allowed to issue tax-free bonds only to help subsidize mortga
