As FHA Defaults Rise, How Will Homebuyers Be Affected? (Mindset)

We missed our #DealHunter family over Thanksgiving, so we decided to give you a back-to-back dose of the #ForeclosureDealsCoachPodcast to jump-start your week!

Today, we discuss FHA loan default and its effect on the industry. The FHA (Federal Housing Administration) is a federally-backed insurance company that helps secure mortgages for lending institutions as they work with homebuyers. The program has many benefits for homebuyers (you can potentially buy a house with as little as $1,000 down!), but in instances where homeowners can't pay their mortgage, the FHA pays off the loan and takes the home back as collateral. As listeners to the show, you know that banks take possession of properties in much of the same way when their loans go bad, fueling the foreclosure market. However, in the case of the FHA, the properties are transferred to HUD (the Department of Housing & Urban Development) and are listed to sell. The FHA and other lending institutions share a key feature - THEY'RE NOT REAL ESTATE AGENTS. As such, both entities are motivated to offload these properties to buyers and investors to clear the bad loans from their books. But how would an influx of FHA defaults affect the market as owners look to buy & sell their properties? If you've read this far, you should probably just click the link and let Donny school you on how FHA defaults might affect you as you look to flip your latest deal to those anxious homebuyers.

 Mentioned in today's episode:
Propstream

Here's a link to the article Donny discussed in today's episode:
FHA Modifies Loan Standards As Defaults Pile Up: How The Changes Affect You

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