Buy Now ~ Before the Cost Goes Up!
Don’t forget the cost of FHA mortgage insurance is going up. But there is a window of opportunity to get an FHA loan before the this happens. As long as the the laon in obtained before April 5, you can get an FHA loan with 1.75% upfront mortgage insurance (versus 2.25% AFTER April 5).Why This Is Happening:
· FHA’s capital reserve requirement mandated by Congress has fallen below the minimum requirement.
· FHA makes up 1/3 of all financing in today’s market
· FHA’s capital reserve requirement mandated by Congress has fallen below the minimum requirement.
· FHA makes up 1/3 of all financing in today’s market
What Will Change:
· Increase in the up front MIP Fee to 2.25% from 1.75%
· FHA is also asking Congress to increase its monthly premium which is one of the major advantages compared to a Conventional Loan’s PMI rate. (This has not been finalized yet).
· Seller concessions will be lowered to 3% from 6% - currently viewed as a reason to inflate appraisals.
· Minimum Credit Score of 580 – lower scores require 10% down
· Most likely will not increase the amount the buyer needs to bring to the table, but by increasing the PMI it will increase payments (which is one way to add to the reserve without hurting buyers)
· Increase in the up front MIP Fee to 2.25% from 1.75%
· FHA is also asking Congress to increase its monthly premium which is one of the major advantages compared to a Conventional Loan’s PMI rate. (This has not been finalized yet).
· Seller concessions will be lowered to 3% from 6% - currently viewed as a reason to inflate appraisals.
· Minimum Credit Score of 580 – lower scores require 10% down
· Most likely will not increase the amount the buyer needs to bring to the table, but by increasing the PMI it will increase payments (which is one way to add to the reserve without hurting buyers)
So, Save $$$ ~ Buy NOW!!! Don't hesitate on this one, time is running out!
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