Shelly, FHA got tossed out of the arena with most buyers unless there were low ratios, credit scores or money could not be identified.  I thought it was great that conventional loans allowed for such great diversification but I was one of those that didn't realize that consumers were spending more than they make.  

If FHA does put in 100% financing, it will be with some strick guidelines.  I believe that 3% will be the minimum for down payments.  

Countrywide is no longer be a strong ranking lender.  National City Mortgage no longers allows Equity Loans but only through the banks.  I was talking to my Wells Fargo Mortgage friend who used to be at Countrywide, and she told me that financing as a whole will take a step back to the way it used to be 10 years ago.  

BTW - on cashouts, the banks are now scrutinizing your past mortgage history and not for the existing mortgage but past mortgages.  

Barb

Shelly,

I think that would be a great idea but it won't work. Buying a home had become too easy. First time homebuyers did not have to make any sacrifices to become homeowners........ I believe they must have a stake in the process, given up $6 Starbuck's coffee, designer clothing and purses, cell phones, european cars, and the list goes on!!!! Why shoud they have the same benefits than the Vets? What did they offer to society?

However, local governments can help first time homebuyers with down payments and closing costs assistance. However those funds will have to be given back when they sell the house to move up to a better house so the funds can be used for another first time homebuyer. I support such a program. In the meantime FHA financing will have to be adjusted to fit the demands and criteria of the today's first time homebuyers.

Several options are available to them

Sagine