In an effort to boost home ownership, the Federal Housing Administration is relaxing some of its underwriting standards used to determine eligibility for home loans.
According to the Mortgage Banker's Association of America, the relaxed standards will make homeownership possible to more than 50,000 additional households.FHA officials said they will reduce the barriers to homeownership allowing lenders to serve more nontraditional and underserved borrowers and clarify underwriting requirements so they are not applied in a discriminatory manner.
The changes include recognizing income from part-time work, overtime and bonuses; disregarding child-care expenses when calculating monthly debt obligations; and recognizing alternative methods of saving money.
These changes were recommended by representatives of the mortgage finance industry, state and local housing agencies, community-based organizations, consumer groups and secondary market organizations.