The Homeowners Armed with Knowledge program, or HAWK, was announced by the
After two years with no delinquent payments, the homeowner qualifies for another discount.
Borrowers who take the classes, which include several courses before and after closing, can save an average of
"It may not seem like it, but
A public comment period on the program will end in mid-August, and White believes borrowers will be able to begin applying by year's end.
FHA doesn't write loans, it ensures them, and typically targets under-served populations. Borrowers can get an FHA-backed loan with as little as a 3.5 percent down payment and a credit score of 560. Conventional loans can require 20 percent down and a minimum credit score of 620, White said.
Credit scores from the
"Most people who are buying a home don't know anything," White said. "They have a little bit of money in the bank and a decent credit score and want a house."
Under the program, borrowers who take housing counseling class before signing a contract to buy a home, and who complete additional counseling before finalizing the sale, can earn a 50 basis point reduction in upfront mortgage insurance and a 10 basis point reduction in the annual premium cost. Upfront mortgage insurance premiums are 1.75 percent of the total loan amount, while annual monthly premium costs are 1.35 percent.
An additional 15-basis point reduction will be awarded after two years with no delinquencies.
"If you talk about the long-term impact and how much it will save homeowners, this will absolutely help," said
The classes will be taught by agencies approved by the
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