Tag Archives: FHA
FHA Increases – Buying a Home Is Now More Expensive
Effective for FHA loans for which the case number is assigned on or after October 4, 2010, FHA upfront and annual MIP will change as follows: – Upfront MIP - 1.00% on ALL mortgage terms (from 2.25%) … – Annual MIP - 0.85% for LTVs less than or equal to 95% and terms of more than 15yrs (from .50%) * No Change in Annual MIP for <=15yr Terms (No Annual MI) In general, monthly payments are going to INCREASE due to the higher annual MI payment. ** LTV = Loan to Value (the above was sent along by Jason Crigler with Crown Mortgage ) Keep in mind that the FHA loan limits for the Charlottesville MSA are: Single Family/Attached – $437,000 Two family – $559,450 Three Family – $676,200 Four Family – $840,400 For an example of what these increases mean you homebuyers in Charlottesville, I’m going to borrow Rhonda Porter’s math : Using an interest rate of 4.25% and a based loan amount of $400,000; it looks like this: FHA Case Number BEFORE September 7 October 10, 2010:
… $400,000 plus $4,000 = $404,000 amortized for 30 years at 4.25% = principal and interest of $1,987.44 plus the annual mortgage insurance of $300 = $2,287.44. Continue reading
FHA Changes – What they mean for the Charlottesville real estate market
Guest post by Matt Hodges with Compass Home Loans : FHA has picked up much loan volume that the sub-prime world vacated – so much so that for every ten new purchases, FHA insures three.
…For all new case numbers (FHA’s mechanism to keep track of loans they insure) assigned on April 5, 2010 or later, the UFMIP will increase from 1.75% to 2.25%. … It might be at a $200,000 loan, but at $100,000, most borrowers will expend at least $3000 in closing costs, pre-paid items and points. … If HUD removes the ability to get seller concessions at the lower loan amounts, they will be directly affecting the housing recovery and effectively be discriminating against poorer borrowers, who can only afford lower priced homes. Continue reading
Changes coming to FHA loans
“We want to ensure that we are able to continue to support the housing market in the short term and provide access to homeownership over the long-term, while minimizing the risk to the American taxpayer,” Housing and Urban Development Secretary Shaun Donovan told a congressional committee in written testimony.
…The FHA charges an upfront insurance premium of 1.75% of the total cost of the mortgage which most borrowers can roll into their loan, and then they pay additional annual premiums of either 0.5% or 0.55%, depending on their down payment. … The FHA says that it will limit the amount of money that sellers can provide for closing costs on home sales to 3% of the home price, from the current level of 6%.
…One close observer of the mortgage channel, who we hope to interview soon in The IRA, says that given the recent deterioration of mortgage credit, it is impossible that BAC has not gotten its pari passu portion of the losses which are hitting the FHA. Continue reading
A Cautionary Tale – Yet another Due Diligence Question for Buyers, Sellers and Realtors
( ed. note : one of my more favorite questions of late is, “tell me about one of your dissatisfied clients, and why they were so dissatisfied”) We’ve never seen a lender hauled before a panel of their peers on ethics charges (as happens in the Realtor community) though there’s certainly been ample cause. … There are a lot of good lenders who can get deals closed in this lending environment and will tell you if it’s not going to work. Continue reading
