HUD recently announced that it will be lowering the annual mortgage insurance premium. The new lower mortgage insurance premium will take effect starting 1/26/2015. Current FHA annual mortgage insurance premium on a 30 yr mortgage with 3.5% down is 1.35% or $197 per month for a $175k loan amount. The new rate will be 0.85% or $124. A reduction of almost 40% for a savings of $73 per month or almost $900 per year! This means that the borrower will have lower overall payments or increase their purchasing power to move up in price range. This is great news for the housing industry and will "help support home sales, lower housing expenses for affected households, and help bring more balance to the housing market".
If you would like more information regarding this important announcement or have questions regarding a loan/purchase scenario, please feel free to call me anytime.
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