FHA Reform Deal May Be on the Way

Washington, D.C.–Congress may approve a new Federal Housing Authority plan by early April, CNNMoney.com reported Tuesday.Different versions of the bill to update the FHA passed in the House and the Senate last year; the two chambers are working out the kinks, according to Senate Banking Committee Chairman Christopher Dodd, D-Conn., and House Financial Services Chairman Barney Frank, D-Mass.”I think we are fairly close to having an FHA reform bill that we will be able to adopt very quickly,” Dodd said last week.The proposed changes to the FHA, which provides loan alternatives to subprime mortgages, include permanently raising the higher loan limits that the economic stimulus bill granted until the end of 2008, reducing down payment requirements to between 0 and 1.5 percent and adding ways to allow high-cost mortgage borrowers in default or at risk of default refinance.