Early spring, FHA will begin charging differently on loans, due to high FHA mortgage insurance claims. With FHA loans up 21% from a year ago, and 120% two year years, they fear it could get worse. Currently 50% loans held are FHA.
Beginning this spring, FHA will raise mortgage insurance fees, cap the cash contribution sellers are allowed for closings costs and require a high down payment of those borrowers with poor credit scores.
- The new upfront mortgage premium will be increased to 2.25 - up from 1.75%, with some of this amount being able to be rolled into the loan.
- Borrowers must have a FICO score of 580 to qualify for the FHA's 3.5% down payment loan, and if it is lower, there will be a 10% down payment required. Most lenders currently require a minimum score of 620. The higher the score, the better the credit and the likelihood of qualifying for the least expensive loan.
- Sellers will only to be able to contribute up to 3%, half of the current 6% allowed.
So, bottom line, if you are looking for obtain an FHA loan, you may want to jump into the market today, and don't wait. Also, the Mortgage Bankers Assn has announced the interest rates most likely will increase one full percentage point early spring.
Joan Cox
Metro Brokers - House to Home, Inc.
Denver, CO 80237
720-231-6373
www.JoanCox.com
About Me
- Joan Cox
- Denver, Colorado, United States
- With 13 years in real estate, I specialize in relocation, new construction, investor purchases, first time homebuyers and sellers. Ask me about my web site! Call today - 720-231-6373 In August 2009 I opened MY OWN Metro Brokers office in the Tech Center.
