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I read the press earlier today also and this is getting a little out of control, we had some consistency in our business for about a year and now this
Rob - I honestly don't think it's going to make a difference with my FHA home buyers.
Rob what a great question and a good illustration of the realities. Quite frankly some buyers will not be effected by the increase, but others might be eliminated by a$50 per month increase, especially as the price of gas and everything else is increasing. Therefore any increase will hurt the market.
Thanks for your comments. I agree, for the most part, that the change will not deter the motivated homebuyer. However, where we do see these adjustments to the MI manifest themselves are in cases where an FHA mortgage holder tries to refinance. Because the MI levels are not grandfathered, when a borrower attempts to get a lower rate, sometimes even if he/she can, the benefit is offset by the higher MI on the new loan. It's not a perfect world, we all know that, but I think this is hindrance to the system that could be logically addressed AT THE SAME time the FHA protects its financial viability.
Rob: I think as real estate is local, the answer to this might be somewhat local in nature, as well. And I also believe that any hit/rise to the costs in obtaining mortgages will have a detrimental effect at this time. The markets are just so fragile. Again, some markets will most likely see bigger responses than others ... but it will definitely take some out of the home buying market, at least for the short term.
Great food for thought and conversation ...
Gene
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