Tim Bradford - AMMCorp.net

head_left_image

Confirmed FHA to increase the upfront MIP effective 4/18/2011

HUD No. 11-013
Lemar Wooley
(202) 708-0685
FOR RELEASE
Monday
February 14, 2011

FHA TAKES STEPS TO BOLSTER CAPITAL RESERVES
New premium structure for 30- and 15-year loans will help private capital return

WASHINGTON - As part of ongoing efforts to strengthen the Federal Housing Administration's (FHA) capital reserves, FHA Commissioner David H. Stevens today announced a new premium structure for FHA-insured mortgage loans increasing its annual mortgage insurance premium (MIP) by a quarter of a percentage point (.25) on all 30- and 15-year loans.  The upfront MIP will remain unchanged at 1.0 percent.  This premium change was detailed in President Obama's fiscal year 2012 budget, also released today, and will impact new loans insured by FHA on or after April 18, 2011. 

"After careful consideration and analysis, we determined it was necessary to increase the annual mortgage insurance premium at this time in order to bolster the FHA's capital reserves and help private capital return to the housing market," said Stevens.  "This quarter point increase in the annual MIP is a responsible step towards meeting the Congressionally mandated two percent reserve threshold, while allowing FHA to remain the most cost effective mortgage insurance option for borrowers with lower incomes and lower down payments."

The proposed change was announced last week as part of the Obama Administration's report to Congress, which outlined the Administration's plan to reform the nation's housing finance system.  The Administration's housing finance plan also recommended that Congress allow the present increase in FHA conforming loan limits to expire as scheduled on October 1, 2011.

This premium change enables FHA to increase revenues at a time that is critical to the ongoing stability of its Mutual Mortgage Insurance (MMI) fund, which had capital reserves of approximately $3.6 billion at the end of FY 2010.  The change is estimated to contribute nearly $3 billion annually to the Fund, based on current volume projections.  It is vital that HUD take action to ensure that FHA will continue to serve its dual mission of providing affordable homeownership options to underserved American families and first-time homebuyers while helping to stabilize the housing market during these tough times.

On average, new FHA borrowers will pay approximately $30 more per month.  This marginal increase is affordable for almost all homebuyers who would qualify for a new loan.  Existing and HECM loans insured by FHA are not impacted by the pricing change.

FHA will continue to play an important role in the nation's mortgage market in 2011.   President Obama's FY 2012 budget projects the FHA will insure $218 billion in mortgage borrowing in 2012.  These guarantees will support new home purchases and re-financed mortgages that significantly reduce borrower payments. 

Read FHA's Mortgagee Letter on this premium increase  


Tim Bradford
Ohio Mortgage Banker LO.007173.000/ NMLS 250013
Cell: 216.324.8113 Anytime
www.GetAMortgageNow.com or www.Go2Apply.com
www.OhioHomePath.com or www.OhioRuralHomeLoans.com

Serving the Ohio Realtors and Home Buyers and Home Owners
Comment balloon 2 commentsTim Bradford • February 14 2011 06:26PM
Confirmed FHA to increase the upfront MIP effective 4/18/2011
share
HUD No. 11-013 Lemar Wooley (202) 708-0685 FOR RELEASE Monday February 14, 2011 FHA TAKES STEPS TO BOLSTER CAPITAL RESERVES New premium structure for 30- and 15-year loans will help private capital… more
Obama Administration Plan Provides Path Forward for Reforming America…
share
This article can be found on Treasury. gov I have highlighted some items that will be of concern to the Real Estate Community. At the end of the article you will find a link to the White Paper explaining the Administrations proposal. .. more
Our Congressman Sues House Congressional Cafeteria for $150, 000
share
One the Day after The State of the Union where Obama spoke of Frivolous Lawsuits, Dennis Kucinich has filed a $150, 000 Suit against the House Congressional Cafeteria. Here is the Complete Story http://www. woio. com/Global/story. asp? S=13915948 # &… more
Fannie Mae Guidelines Change Monday. Apply Today To Lock In To “Old”…
share
This is a good reminder of some of the changes in the market. Gift funds could be allowed on a conventional purchase to cover the first 5% down payment. Also, do not count upon excluding a monthly debt with only a few payments remaining. .. more
"WE CAN GET YOUR LOAN MODIFIED AND GET YOUR MORTGAGE BALANCE…
share
This is good information for consumers considering a Mortgage Modification. Please read this post and also the READ MORE link. FTC Issues Final Rule to Protect Struggling Homeowners from Mortgage Relief Scams Rule Outlaws… more
FORECLOSURES IN MARYLAND? WHAT ABOUT THE CONDITION? MEET THE FHA 203…
share
This is a Great Post by Lenn and the 203K loan is a great loan for Buyers that "Can See the Potential". At the right purchase price a buyer can purchase some of these homes at Bargain Basement Prices and then Repair, Fix Up ir improve… more
The Foreclosure Scandal Has Become Pandemic
share
I believe this article will give some background and insite to what people are calling the "Foreclosure Scandal/Fraud" http://www. washingtonpost. com/wp-dyn/content/article/2010/09/22/AR2010092206650. html I ask people to Read the… more
Nominate Real Estate's Most Influential right here!
share
Use this post by to nominate your favorite ActiveRain bloggers to be in the top 100 people on Inman's. I did look at last years list and was supprised that none of the names I saw were from ActiveRain. Hopefully this year we activily… more
OHFA Loans now at 4. 25%
share
Mortgage Rates 4. 25% for loans without 2. 5% assistance grant* 4. 75% for loans with 2. 5% assistance grant 4. 00% for Ohio Heroes without 2. 5% assistance grant* 4. 50% for Ohio Heroes with 2. 5% assistance… more
Rumors must stop - FHA loans in New Jersey will be increasing their…
share
Jeff's Post correct some miss information that is circulating about the proposed change in FHA's MIP Premiums. Besides individualsconsidering a home purchase, current Ohio home owners considering refinancing using a FHA Loan or a FHA… more