Gary Miller Proposes Shared Equity Homeownership to Strengthen FHA

I came across this article published yesterday, “Rep. Gary Miller Introduces Shared Equity Homeownership Bill”. The link is provided below for you.

Here’s an excerpt from the article explaining the program, “Specifically, the legislation establishes a pilot program through the Federal Housing Administration (FHA) where homeowners, working through FHA, can sell a portion of the equity in their home to an investor. In return, the family shares with the investor the value of any home price appreciation that may occur relative to the proportion of the investment. Any investment will go toward principle and may not be used for downpayment or closing costs as the homebuyer will have to comply with all FHA requirements for homeownership including the mandatory downpayment requirements. Additionally, in order to protect the mortgagor, investors must be completely independent and not a party to the sale eliminating the ability of sellers to provide investment in homes they are selling. The mortgagor must retain at least a 60 percent equity share in the home and will retain all rights associated with homeownership. If a loss is incurred on the sale of the home, the investor likewise shares in the loss in proportion to the initial investment.”

 

http://california.realestaterama.com/2010/09/30/rep-gary-miller-introduces-shared-equity-homeownership-bill-ID0763.html

What do you think?

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