Expanding American Homeownership Act of 2006

The Expanding American Homeownership Act of 2006 (H.R. 5121) proposes significant changes to the Federal Housing Administration (FHA) to make it easier for more Americans to qualify for home loans. The bill would allow the FHA to insure mortgages with zero down payment, replacing the previous 3% minimum requirement, and would extend the maximum length of a mortgage from 35 to 40 years to help lower monthly payments.

Additionally, the legislation would raise the limit on the size of loans the FHA can insure, allowing the agency to better serve homebuyers in high-cost areas. For senior citizens, the bill removes the cap on the number of reverse mortgages the government can insure and expands the program to allow seniors to use reverse mortgages to purchase new homes. To protect the taxpayer, the bill also establishes new financial safeguards and reporting requirements to ensure the government’s mortgage insurance fund remains stable.