Commissioner David Stevens on Wednesday stated that to give a lift to FHA’s balance sheet changes are being made at the government mortgage insurer. Presently it backs about half of all home loans to the nation's minorities.

Increasing the up-front Mortgage Insurance Premium from 1.75 percent to 2.25 percent which is paid by borrowers, for the second time in two years it requested the legislative authority to increase the maximum annual MIP that the FHA can charge.

Commissioner Stevens added that, “Striking the right balance between managing the FHA’s risk, continuing to provide access to underserved communities, and supporting the nation’s economic recovery is critically important.”

New borrowers will be needed to have 580 as the minimum FICO score to qualify for the 3.5 per cent down payment program. Anyone having a FICO score of less than 580 will have to put down at least 10 per cent.

Changing allowable seller concessions will provide more financial stake to borrowers in their home purchases.

The FHA has been under a scanner of late as increasing defalts have acted against the agency.