n case you haven’t already heard, FHA Loans are changing again next month. The FHA (Federal Housing Administration) is re-working the system, and starting April 1st mortgage insurance fees will go up from 1 percent to 1.75 percent, and the annual premiums will increase by 0.1% on all loans under $625,000 and 0.35% on mortgage amounts above that, effective June 1.
This change by the FHA is intended to increase the financial activity of the FHA mortgage program so that it does not need a government bailout like Fannie Mae and Freddie Mac.
Consumers will have a small window of opportunity to purchase or refinance using FHA financing under the old mortgage insurance structure. Applications must be turned in well before April 1st in order to beat the increase, but thankfully, transactions can close after that date.
For those purchasing a home, rates are still hovering around historic lows and FHA allows a down payment of as little as 3.5 percent of the purchase price. For those interested in refinancing, FHA also has a streamlined alternative that allows a loan amount of up to 125 percent of the current value of a home if it is currently financed with an FHA mortgage.
Not sure if an FHA mortgage will benefit you? Give the Mortgage Guys in Atlanta, GA a call in order to take advantage of purchasing or refinancing your home in Smyrna, GA or Metro Atlanta before April 1st to take advantage of these rates before they increase.