Senate passes FHA down payment bill

Expressing strong support for Senate Bill 2239, the "FHA Downpayment Simplifi-cation Act of 2002," the nation's home builders said that passage of this vital legislation by the Senate Oct. 18 will help to increase the availability of affordable housing and expand rental housing and homeownership opportunities across the country.

"The National Association of Home Builders fought hard to have this important housing legislation passed by the Senate before Congress adjourns for the year," said Gary Garczynski, president of NAHB and a home builder/developer from Woodbridge, Va. "We urge the House to act on this bill when it returns after the November elections."

The legislation contains several provisions designed to enhance housing affordability, including indexing FHA multifamily loan limits to inflation, permanently extending the FHA down payment simplification process and repealing a scheduled increase in the Ginnie Mae guaranty fee that would have raised the cost of housing for people using FHA insurance and VA guaranty programs.

"Indexing the loan limits to inflation will provide stability to FHA multifamily mortgage insurance programs and give builders and lenders confidence that they will be able to use the programs in their communities every year, even as construction and land costs rise over time," said Garczynski.

The Senate housing bill would further enhance housing affordability by permanently extending the FHA single-family simplification down payment process, continuing to make it easier for low- and moderate-income families to obtain the necessary financing to purchase a home.

"S 2239 contains several components to make rental housing and homeownership more affordable and obtainable for American families. This legislation will aid households and communities across the nation. I urge the House to move quickly on this measure when it reconvenes next month," said Garczynski.