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Follow on Google News | FHA’s Move to Increase Mortgage Insurance Premiums Will Negatively Impact Home SalesBrian Leibowitz, CEO and Owner of Affordable Financial Services, says there will be fewer homes being purchased once the Federal Housing Administration’s plans to increase mortgage insurance premiums on homeowners and request from borrowers
By: Affordable Financial Services The FHA recently announced that it is increasing mortgage (http://affordable- For prospective homeowners who apply for loans of more than $625,500, they will now have to place a minimum down payment of 5% instead of the current 3.5%. The FHA will also make it more difficult for those with low credit scores and high debt-to-income (http://affordable- The FHA also announced that, beginning April 1, it will consolidate its Standard Fixed-Rate Home Equity Conversion Mortgage (HECM) and Saver Fixed Rate pricing options for its reverse mortgage (http://affordable- “These changes brought about by the Federal Housing Administration will mean that fewer people will be able to buy a house (http://affordable- The FHA stated it needs to increase these premiums and implement changes to its reverse mortgage programs in order to protect its single-family insurance programs. The FHA’s insurance fund had a reported deficit of $16.3 billion at the end of fiscal year 2012, many of the losses coming from mortgage loans insured by the agency between 2007 and 2009. “This is the fifth time since 2009 that the agency has raised its premiums,” Mr. Leibowitz said. “The FHA has made a series of errors in judgment when they insured these risky loans. Now, in order to recoup their losses, they are asking homeowners and borrowers — who are also taxpayers — to foot the bill. This is not the way to fix the mortgage mess.” For more information (http://affordable- End
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