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If the Time is Right- Don't Wait!!

By
Real Estate Agent with Compass Real Estate SP98362422

Here is some advice straight from Troy Hine, Senior Loan Officer at Preferred Mortgage. I am working with him on a few deals and thought that his open letter below, was worth sharing. If you have questions for him, I will pass them along and post his replies!


"Those Who Wait Will Pay Thousands More This Spring"

Waiting a few extra days or weeks to purchase a home this spring could cost buyers thousands of extra dollars as the office of Housing and Urban Development (HUD) implements several changes for loans guaranteed by the Federal Housing Authority (FHA).

Coming just weeks before the April 30 deadline for the Home Buyer Tax Credit and just days after the March 31 expiration of the Federal Reserve Board's mortgage backed securities purchase program (which has kept home loan rates artificially low for over a year), these FHA changes make it even more important to act now to save big.

Here are a few reasons why:

On April 5th, the cost of required up-front mortgage insurance for loans guaranteed by the FHA will increase from 1.75% to 2.25%. For a borrower purchasing a $200,000 home with a $7,000 down payment, the up-front mortgage insurance will increase by $965. Up-front mortgage insurance is typically financed in the final loan amount so the impact to a monthly payment will be minimal but overall, the increase is still borne by the borrower both upfront and monthly.

Later this spring, the amount of money that a seller can return to the buyer from their sale proceeds will be reduced from 6% to 3%. The reduction in these "seller concessions" can increase the amount of cash a buyer will be required to pay at closing by $6,000 for a home purchase of $200,000.

There is only one way to avoid being affected by all of these costly changes that lie ahead - submit all FHA mortgage applications by the last week of March.

Troy A. Hine

Senior Loan Officer

Posted by

Ellie Shorb, Realtor, Compass, 240-338-8919 Licensed in DC, MD, VA

A luxury home specialist specializing in exemplary client care, professionalism & privacy.

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