Posted on 04/03/2014 12:35:47 PM PDT by illiac
The rising insurance rates on Federal Housing Administration mortgages are putting home purchases “increasingly out of reach” for many qualified buyers who rely on FHA financing, National Association of REALTORS® President Steve Brown wrote in a letter to FHA Commissioner Carol Galante. In the letter, Brown urged FHA to lower its annual mortgage insurance premiums.
Brown acknowledged the significant losses that FHA’s Mutual Mortgage Insurance Fund faced during the housing crisis. FHA increased its premium structure as one way to reach a required 2 percent capital reserve ratio.
But now that the agency is on the path to recovery, NAR is urging FHA to lower the annual mortgage insurance premiums and eliminate the requirement that mortgage insurance be held for the life of the loan.
(Excerpt) Read more at realtormag.realtor.org ...
How true!
Yes, lets do the carnage again.
These actions, and rising rates are already creating a low inventory of homes for sale in north Idaho.
I have an FHA loan which I got before they changed how they handle the loan insurance. You used to pay an up-front loan insurance premium, and then a monthly premium until you owed less than a certain percent of the sale price.
Now, not only did the insurance premium rate go up, you have to pay it for the entire length of the loan. The extra cost of the insurance exceeded any savings I would have seen with a lower interest rate.
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