Democrats and Republicans on the House Financial Services Committee will get a chance to debate the merits of their respective Federal Housing Administration reform bills April 19 at a housing subcommittee hearing.The competing bills are aimed at re-energizing the FHA single-family program so it can serve more subprime borrowers by charging risk-based premiums. The Republicans' bill (H.R. 1752), introduced by Judy Biggert, R-Ill., would allow the FHA to charge a maximum upfront mortgage insurance premium of 3% and an annual premium of 2%. The Democrats' bill (H.R. 1852), introduced by Rep. Maxine Waters, D-Calif., would cap the upfront premium at 2.25% and the annual premium at 55 basis points for borrowers who make a downpayment, even if their credit score is below 560. For those risky borrowers, the FHA can require homeownership counseling and take other consumer protection measures. Democrats contend that the Republicans are charging too much for borrowers who make a downpayment.

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