The Federal Housing Administration will reportedly announce more stringent lending requirements and higher borrowing fees. The move comes in response to growing concerns that rising losses on mortgages it insures will require a taxpayer bailout. Although any credit tightening is welcome, the agency will not propose an increase in the minimum downpayment, currently 3.5 percent. (Borrowers with credit scores below 580 will be required to put down a minimum of 10 percent, but most FHA lenders already require a 620 minimum score.)
The Wall Street Journal ran the story last week: “U.S. Now a Renters’ Market.” Apartment vacancies hit a 30-year high in the last quarter of 2009, and rents are falling in most markets. For current or former homeowners trying to stumble out of the debris left from the government-fueled housing bubble, a renter-friendly environment is a positive opportunity.
As Congress hashes out an agreement behind closed doors to expand the government’s role in health care, a Medicaid story out of New York serves as another reminder that government is part of the health care problem, not the solution. Audits released by the state’s comptroller found $169 million in misspent funds, including a $196,000 cab bill for a woman who took a daily $300 taxi ride to visit her son in Albany for three years.