Are there FHA Changes on the Horizon?
Sounds like changes to FHA are inevitable and probably good, but also probably somewhat painful for Realtors.
Here is an excerpt of an email I got from a local Mortgage Banker. Chris Reichman. You know hes a good guy cause his first name is Chris. Just kidding but he really is a good guy.
Chris' message:
Hello all. As many of you might be aware the Federal Housing Authority (FHA) loan program has been under a great deal of scrutiny from congress lately due to losses sustained over the past few years. The congressionally mandated 2% insurance reserve that the agency is required to keep on hand has dwindled to around .53%. We have been watching closely as the FHA interacts with congress to develop certain reforms to the current FHA loan package. This is impactful for us since the FHA loan program is heavily utilized, particularly for first time / younger home buyers. Although the official announcement has not come out yet, we have learned of some of the expected changes that will be taking effect this year. Definitely nothing too alarming here...just want to keep you all in the loop. Some of the highlights to watch for are listed below. Please feel free to call me if you have any questions at all. Thank you.
- The upfront mortgage insurance premium will be raised from 1.75% of the loan amount to 2.25% (this can be rolled into the loan) sometime this Spring.
- FHA has asked Congress for the authority to raise the monthly mortgage insurance premium. This is only a request posed to Congress at this point, so no timeframe on when/if this will end up happening.
- Maximum seller contributions have been lowered from 6% to 3%; expected to take effect early summer
The good news...the general down payment (at least for the time being) will remain 3.5%. It had been proposed to raise the minimum down payment to 5%. As of now that is not going to happen.
Chris Reichmann
Mortgage Banker
Republic Mortgage
909 South Townsend Avenue, Suite A
Montrose, CO 81401
Office: (970) 249-1615
Fax: (970) 240-7931
Mobile: (970) 417-7677
Thanks Chris for the email and the info.
Hope this helps you keep on top of the change...
Chris Ormsbee
www.C21ActionRealty.com/cormsbee
Chris Ormsbee - Colorado Licensed Real Estate Broker/Realtor
Give me a Call - (970) 209-0252
Century 21 Action Realty - (970) 249-7777 - 1245 E Main St. Montrose, CO 81401
Check out the websites if you like:
www.SoldCORE.com - Western Colorado Real Estate, Community, and Demographic Information and Links
www.MontroseGoldTeamBlog.com - Information and Opinions about Real Estate, The Job of selling it, and the process of buying or selling a home or commerical property. Especially in Montrose Colorado.
www.C21ActionRealty.com/cormsbee - Search Western Colorado & Montrose Homes & Properties Here!
www.C21ActionRealty.com - The Century 21 Action Realty Website (search properties or find other agents in my office.)
www.YourCOREAdvisor - Blog with other information about buying and selling Real Estate.
Good info for those in the market to buy...another reason they should get off the fence and buy now!
Thanks Renee and I agree if they need a home and can afford it, there may not be a better time. We may see some lower prices, but it is unlikely we will see these rates or terms that are offered right now plus with an 8K tax credit bonus. The Government definitely has the "incentive" pumped up right now.
Ready Fence Sitters, Set, now Go out an call your local Realtor and buy a home. :-)