First-Time Home Buyers Might Have Easier Time Getting Mortgage

New policies are in the works

Federal regulators are working on new policies that might make it easier for first-time home buyers to obtain a mortgage, reports The New York Times.

Mel Watt, director of the Federal Housing Finance Agency, says he will postpone a proposed reduction in the size of loans that Fannie Mae and Freddie Mac can buy.

Watt also says he will be doing away with plans to reduce the financing they provide for apartment building loans.

Furthermore, Watt says Fannie Mae and Freddie Mac would loosen regulations that determine when banks are required to buy back faulty loans.

Watt says the Federal Housing Finance Agency does not have any immediate plans to reduce mortgage principals for borrowers whose homes are now worth less than their mortgages. However, he adds that this does not mean the possibility is completely off the table.

Says the New York Times:

“[Watt] also announced a pilot program in Detroit that would permit extended loan modifications available under a program that helps so-called underwater borrowers refinance loans. He said the FHFA hoped to expand the program nationwide.”

 

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