We’ve gotten good news for Gainesville Home Buyers that will need a mortgage. This info has been provided by Eric & Leslie Remy of FBC Home Loans (Gainesville office). We’re sharing it here with our Gainesville Home Buyers.
It appears that FHA has started to wake up and realize they are pricing potential homebuyers out of the market and have taken a step in the right direction by reducing their steep Mortgage Insurance Premiums from 1.35% down to .85%. This is a step in the right direction and comes on the heels of the announcement from Fannie Mae in December that they were bringing back their 3% down payment loan program for first time homebuyers which includes a reduced monthly PMI. This change does not take place immediately, however, HUD realizes this could potentially slow down buyers that are prequalified with the FHA program and have stated they will act quickly to implement the changes. Click here to read the White House Fact Sheet and below are the highlights. If you have any questions please feel free to give us a call or send us an email at TeamRemy@fbchomeloans.com
Additional Information on the FHA Premium Reduction
The highlights are:
- Premium change
- Annual premium is being reduced 50 bps from 1.35% to .85%
- There is no change to the upfront premium (1.75%) or the life of loan requirement
- Applies to all FHA loans
- Both purchases and refinance transactions will benefit from the premium reduction
- The Administration estimates:
- 800,000 homeowners will be able to refinance this year
- 250,000 new homebuyers over the next three years
- No Congressional action is necessary
- FHA’s law states that the annual premium cannot exceed 1.5%. There is no need for Congressional action to lower the premium.
- While some in Congress already oppose the reduction, the law would need to be changed and that is highly unlikely.
- When will the premium reduction be implemented?
- The White House/HUD understands that homebuyers and borrowers wanting to refinance will wait until it is implemented.
- We expect it will be implemented very quickly – “HUD will provide technical updates soon”
As your buyers agent when searching for your next home in Gainesville, we want you to be informed of the current mortgage market! When you’re ready to start, we are here to HELP YOU!