Changes to FHA loans are headed our way this summer. The up front mortgage insurance premium (Financed back into the loan) will be changing from the current 1.75% to 2.25%.
There is also a change to the seller credit for FHA loans, currently we are sitting at 6% in allowable seller credit toward recurring and non recurring closing cost, the new guidelines will limit seller participation to 3%.
There are also rumors of the monthly mortgage insurance increasing as well, this is part of the homebuyers total payment, so this change would make the monthly payment increase for thoose seeking FHA financing....
Why are we seeing these changes? FHA portfolio is growing too quickly and their available cash reserves are shinking very fast. In efforts to stay in business they need to drastically reduce their exposure to higher risk buyers and increase their portfolio with safer, stronger buyers. All the more reason to take advantage of the current guidelines while you still can.
Ryan Morrow
Loan Officer
Office: (661) 723-1232 ext. 211
Cell: (661) 992-2216
Fax: (866) 890-0544
Ryan_Morrow@FrostMortgage.com
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