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by CareyBot

The Obama administration is moving to tighten underwriting standards on FHA-backed loans by increasing the amount of upfront cash homebuyers must bring to the table, raising minimum FICO scores for new borrowers, and reducing maximum seller concessions from 6 percent to 3 percent.The most obvious way to increase upfront cash requirements would be to raise the 3.5 percent minimum downpayment requirement for loans guaranteed by the Federal Housing Administration.A bill introduced Oct. 1 by Rep. Scott Garrett, R-N.J., would raise the minimum downpayment for FHA loans to 5 percent and prohibit financing of closing costs. HR 3706, which has 27 co-sponsors, has been referred to the House Financial Services Committee.Housing Secretary Shaun Donovan, briefing committee members on the administrati...