Overview: Housing Financial Literacy Act of 2025
| Bill Number | Chamber | Sponsor | Date Introduced |
|---|---|---|---|
| H.R.6125 | House | Rep. Joyce Beatty (D-OH-3) | November 19, 2025 |
The Housing Financial Literacy Act of 2025 is a bill to reduce FHA mortgage insurance premiums for first-time homebuyers who complete financial literacy housing counseling programs.
The bill was introduced in the current Congress (119th) on November 19, 2025, in the House of Representatives by Rep. Joyce Beatty (D-OH-3). The bill has bipartisan support with 31 cosponsors, including Rep. Mike Carey (R-OH-15).
Only about 4% of bills become law, according to FactCheck.org. This article reviews what the Act proposes.
Note that bills often change on their way to becoming law, so this page will update as new details emerge. For real-time updates about this and other first-time home buyer programs, subscribe to our newsletter.
Bill Overview
Housing Financial Literacy Act of 2025
A bill to reduce FHA mortgage insurance premiums by 25 basis points for first-time homebuyers who complete financial literacy housing counseling.
Bill Overview
Housing Financial Literacy Act of 2025
A bill to reduce FHA mortgage insurance premiums by 25 basis points for first-time homebuyers who complete financial literacy housing counseling.
Official Title as Introduced
To require the Secretary of Housing and Urban Development to discount FHA single-family mortgage insurance premium payments for first-time homebuyers who complete a financial literacy housing counseling program.
House of Representatives
What is the Housing Financial Literacy Act of 2025?
The Housing Financial Literacy Act of 2025 is a bill that would reduce FHA mortgage insurance premiums by 25 basis points (0.25%) for first-time homebuyers who complete a financial literacy housing counseling program.
The bill amends the National Housing Act to require the Secretary of Housing and Urban Development (HUD) to discount FHA single-family mortgage insurance premium payments for eligible buyers.
How the Discount Works
Currently, FHA mortgage insurance premiums are set by HUD and typically range from 0.15% to 0.75% of the loan amount annually, depending on the loan term, down payment amount, and loan-to-value ratio.
Under the Housing Financial Literacy Act, eligible first-time homebuyers would receive a 25 basis point (0.25%) reduction in their annual mortgage insurance premium. This discount would apply for the life of the loan, as long as the borrower maintains their FHA mortgage insurance.
Example: Mortgage Insurance Savings ($300,000 FHA Mortgage)
| Without Discount | With Discount | |
|---|---|---|
| Premium rate | 0.55% | 0.30% |
| Annual premium | $1,650 | $900 |
| Monthly premium | $137.50 | $75.00 |
| Monthly savings | — | $62.50 |
Over a 30-year loan term, this discount could save borrowers approximately $22,500 in mortgage insurance premiums.
Who Qualifies for the Housing Financial Literacy Act?
To qualify for the Housing Financial Literact Act, home buyers must be qualified first-time home buyers using an FHA-insured mortgage.
1. Must be a first-time homebuyer
To be eligible as a first-time home buyer, program participants may not have owned a home or co-signed on a mortgage within the last 3 years, including for primary residences, second homes, and investment properties. Commercial properties are excluded.
For mortgages with two or more applicants and mortgages with a non-occupant co-borrower, at least one person living in the home must meet the first-time home buyer requirement.
Reference: Who qualifies as a first-time home buyer
| Scenario | First-Time Home Buyer? |
|---|---|
| Shares an apartment, never on title of a home | Yes |
| Still lives at parents’ house, never owned or co-signed | Yes |
| Previously owned a lake cabin, always used as vacation spot | Yes |
| Owned a townhouse, sold it 5 years ago, renting since | Yes |
| Spouse owned a house last year, applicant has not owned | Yes |
| Lost home in foreclosure 2 year agos, renting since | No |
2. Must purchase a residential property
Eligible home buyers must purchase an eligible residential home type. The bill cannot be used in conjuction with land purchases, mobile homes on leased land, or mixed-use buildings where residential is not the primary use.
Homes must also meet structural and soundness requirements typical in mortgage guidelines.
Eligible Property Types
| Property Type |
|---|
| Single-family homes |
| Townhouses |
| Condominiums and co-ops |
| 2-4 unit properties |
| Manufactured homes |
3. Must occupy the home as a primary residence
To qualify, you have to live in the home you’re buying as your primary residence — it can’t be a vacation home, rental, or second home. Homebuyers generally need to move in within 60 days after closing, and the house should be where you live most of the year.
4. Must use FHA-backed financing
The Housing Financial Literacy Act reduces FHA mortgage insurance premiums, so the program applies to FHA mortgages only. Mortgage eligibility varies by lender but, generally, FHA mortgage guidelines require a 580 minimum credit score, 3.5 percent down payment from your own funds, and debt-to-income ratios below 50 percent. Additionally, properties must be in habitable condition or purchased using a FHA construction loan.
If the homebuyer or property does not meet FHA guidelines, they are not eligible for the mortgage insurance premium discount.
Compare an FHA-approved mortgage lender here.
5. Must complete financial literacy housing counseling before applying
The bill requires that eligible homebuyers complete a financial literacy housing counseling program. Counseling must be provided by a HUD-approved housing counseling agency and covers budgeting, credit scores, mortgage basics, homeownership responsibilities, and foreclosure prevention.
HUD-approved financial literacy housing counseling programs typically include one-on-one or group counseling sessions, educational materials, pre-purchase homebuyer education, credit and budget analysis, and post-purchase support.
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Who Sponsors the Housing Financial Literacy Act in Congress?
The Housing Financial Literacy Act of 2025 was introduced in the House of Representatives on November 19, 2025, by Rep. Joyce Beatty (D-OH-3).
The bill has bipartisan support with 31 cosponsors, including Rep. Mike Carey (R-OH-15) as the sole Republican cosponsor. The bill was referred to the House Committee on Financial Services.
For the latest legislative updates and a full list of cosponsors, see the Bill Tracker above.
Frequently Asked Questions About the Housing Financial Literacy Act
Get answers to common questions about the proposed Housing Financial Literacy Act, including eligibility, benefits, and how the FHA mortgage insurance discount works.
Is the Housing Financial Literacy Act available yet?
No. The Housing Financial Literacy Act has been introduced in Congress but is not yet passed into law. It must be approved by the House, Senate, and signed by the President before it becomes available to homebuyers.
How much would the FHA mortgage insurance discount be?
The Housing Financial Literacy Act would reduce FHA mortgage insurance premiums by 25 basis points (0.25%) for eligible first-time homebuyers who complete financial literacy housing counseling.
Can I combine this discount with other FHA benefits?
Yes. The Housing Financial Literacy Act discount would be in addition to other FHA benefits and programs, as long as you meet the eligibility requirements for each program.
Does this apply to all FHA loans?
The bill specifically applies to FHA single-family mortgage insurance premiums for first-time homebuyers who complete the required counseling program.
Is there a Senate version of this bill?
As of now, the Housing Financial Literacy Act has only been introduced in the House of Representatives. There is no Senate companion bill at this time.
