Sorry new home buyers, you won't get that mortgage insurance cut.
Within hours of taking office, the Trump administration removed a newly created benefit that would allow new, first time homebuyers to save approximately $500 per year on their $200,000 FHA home loan. The cut was tied to FHA Mortgage Insurance, an option that millions of new home buyers would have been able to take advantage of starting this week. The standard FHA home loan has become the most popular home loan among first-time buyers recently. With lower basic requirements and added benefits like rolling closing costs and other fees into the loan, a new borrower can be able to afford the costly upfront costs that normally effect a new home buyer.
So what happens now?
As soon as the new administration was sworn in, government-backed mortgage benefits were being reviewed and unneeded programs were wiped off the table. As Ben Carson takes over HUD and the Federal Housing Administration, any programs that offer lower down payments, closing costs and lower credit requirements are sure to get the eagle eye. What might be a small rate cut for new borrowers, can be a positive sign for the economy. As interest rates climb and stability is restored, Americans are going to watch with some minor discomfort as they are forced to grow away from the assistance perks that a controlled recession brought with it. For now, new homebuyers will have to deal with the minor costs that come with owning a new home, the same way previous generations were forced into.
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