A bipartisan bill that cleared the House last week would let first-time homebuyers pay a bit less at closing if they go through homeownership counseling.
Called the Housing Financial Literacy Act, the measure would apply to first-time homebuyers who take out a mortgage backed by the Federal Housing Administration. Borrowers who go through the counseling — aimed at helping them be financially responsible homeowners — would get a discount on the upfront mortgage insurance that all FHA loans require borrowers to pay.
“The idea behind the legislation is that counseling should improve loan performance and make people better borrowers,” said Pete Mills, senior vice president of residential policy for the Mortgage Bankers Association, which generally supports the bill.
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The delinquency rate on FHA loans is close to 9%, compared with about 3% for conventional loans, according to data from the Mortgage Bankers Association. In 2009, in the midst of the…