Purchase Agreement Act (HR996) Co-Sponsor Rep.
Tiberi (R-OH) has introduced legislation that would
eliminate down payment requirements for first-time homebuyers
seeking federally insured home mortgages. (see
complete list of HR996 Co-Sponsors)
"This legislation (HR3755) will make the dream of home
ownership come true for families who can make monthly payments,
but have been denied a mortgage simply because they donít have
money for down payments," said Tiberi, a member of the House
Housing Subcommittee. "Minority families in particular are
burdened by high down payment requirements.
"This new zero down payment program will be
available to first-time homebuyers seeking loans insured by the
Federal Housing Administration. It will make home ownership
possible for those who meet FHAís underwriting requirements and
who could easily afford a monthly payment, but because of their
circumstances have simply not had the opportunity to save for a
FHA loans typically require a minimum down
payment of 3 percent. Tiberiís bill would implement a proposal
made by the Bush Administration and allow FHA to back loans with
no down payment required.
"The legislation introduced by Congressman
Tiberi to offer FHA mortgages with no down payment will unlock
the door to homeownership for thousands of American families,
particularly minorities," said HUD Assistant Secretary for
Housing and Federal Housing Commissioner John C. Weicher.
"President Bush has pledged to create 5.5 million new minority
homeowners this decade, and this legislation will help meet this
This new zero down payment option along with
FHAís existing standards will mean that, in the first year
alone, an estimated 150,000 new families will be able to own
their own home.
"Families who qualify for zero down payment
mortgages will be charged a modestly higher insurance premium on
their home loan," Tiberi explained. "For example, on a $100,000
mortgage, a zero down payment borrower will pay approximately
$50 a month more than a regular FHA borrower. The higher premium
will completely cover the costs of the program, meaning there is
no additional cost to the taxpayer."
Tiberi, a former realtor, was joined by
Financial Services Committee Chairman
Mike Oxley (R-OH), Housing
Bob Ney (R-OH) and other House members in
introducing the zero down payment legislation.
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