Mortgage Rate Update & New FHA Lending Policies

New FHA Lending Policies Recently, the Federal Housing Administration (FHA) announced some lending changes. If you or someone you know is considering an FHA loan, some of these changes may affect you. Here's a brief rundown of the major changes. Increased mortgage insurance - The mortgage insurance premium (referred to as private mortgage insurance by many people) will be increased from 1.75% to 2.25%. This change will add some cost to purchasing a home, but will not overburden consumers since the mortgage insurance is paid over the life of the loan, rather than upfront at closing. New down payment and credit score requirements - According to the new policy, homebuyers who have a credit score of at least 580 may still be able to purchase a home with 3.5% down, but those with credit scores of less than 580 will be required to put down at least 10%. Reduced seller concession - The seller will now only be able to offer the homebuyer 3% to help defray closing costs, as opposed to 6% under the previous policy. The bottom line is that the changes will impact some homebuyers more than others. But in the end, the FHA is still committed to providing affordable home loans.

Mortgage Interest Rates for Fixed Rate Mortgages*

Rates as of Monday, 22nd February, 2010:

Term Conforming APR Payment per $1,000 Jumbo APR Payment per $1,000 30-Yr. fixed 360 5.125% 5.305% $5.44 5.250% 5.336% $5.52 15-Yr. fixed 180 4.500% 4.892% $7.65 4.750% 5.109% $7.78 7-Yr. fixed ARM 360 4.500% 5.178% $5.07 5.500% 5.716% $5.68 5-Yr. fixed ARM 360 4.125% 4.160% $4.85 5.375% 5.589% $5.60 3-Yr. fixed ARM 360 4.875% 5.178% $5.29 5.375% 5.589% $5.60 FHA 30-year fixed 360 5.000% 5.178% $5.37 5.125% 5.210% $5.44

*Rates are subject to change due to market fluctuations and borrower's eligibility.

Karl Peidl Pleasant Valley Home Mortgage Corp. 305 Harper Drive, Suite 3 Moorestown, NJ 08057 856-252-1224 kpeidl@pvhmcoline.com www.karlpeidl.com   New Jersey: Licensed by the N. J. Department of Banking and Insurance Delaware: Licensed Lender by the Delaware Office of the State Bank Commissioner.

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