The future looks bleak for FHA-insured loans.
A mode of federal assistance wherein low-income American earners are allowed to borrow money (usually as down payment) to purchase homes for themselves. If FHA maintains having low interest rates, loans will then have to be refinanced from its portfolio. As a result, it has a $13.5 billion net worth deficit today.
It would not be surprising then if FHA raises its annual mortgage premium to as much as 2.04 percent. Come this 2013, the Department of Housing and Urban Development (HUD) is said to raise its mortgage insurance premium charges, resulting to a $13 monthly increase for average FHA borrowers. Those who will be acquiring home loans next year are most likely to pay higher annual mortgage insurance premiums as compared to the past years. HUD has also revealed that they are adopting a series of aggressive steps which may include revisions of its premium cancellation policy and FHA’s loss mitigation home-retention options.
Said changes are likely to result to an increase in refinancing cost in the following year. It is highly advisable that you take advantage of being informed of the lowest rates available as early as now.
Consult your mortgage bankers at PrimeLending to learn how to lower your monthly payments or tap into your home’s equity. We offer free refinancing advice, designed to help narrow down options based on the different needs of interested homebuyers anywhere in the US.