BY LILY LEUNG
WEDNESDAY, APRIL 6, 2011 AT 1:05 P.M.
Fewer borrowers in San Diego used FHA loans to buy homes in February, mirroring drops seen throughout the country.
In the U.S., the percentage of people using the government-issued mortgages in February fell to its lowest point in 27 months, according to a DataQuick Information Systems review of 20 major metro areas. The company's analysts say the biggest reason for the decreases is stricter lending rules for low down payments loans.
In February, a third of purchase loans among the 20 areas were FHA-insured, down from 38.2 percent one year ago and 34.2 percent in January. Still, FHA lending rates are significantly higher than they were in 2007, when the percentage of home-purchase loans that were FHA ranged from none to 9 percent, data show.
Use of FHA-insured loans have soared over the years because they're popular with starter-home buyers and folks wanting to move up.
"That's because the subprime lending meltdown and credit crunch of 2007 made non-government-insured home loans, especially low-down-payment mortgages, more difficult to obtain, making FHA the obvious choice for many," according to a statement from DataQuick officials.
FHA use was highest in Orlando, at 43.2 percent and lowest in Honolulu at 10.3 percent. San Diego's percentage was 24.4 percent, ranking it 16th among the 20 areas.
Lily Leung: (619)293-1719; lily.leung@uniontrib.com; Twitter @LilyShumLeung
