Articles Tagged With: FHA Loan News

February 7, 2017

Mortgage Loan Interest Rate Trends: Two-Week Lows

Mortgage rates took a move lower on Monday to levels many have been hoping to see more of in the last two weeks. Though the move does not dramatically change mortgage loan interest rate numbers, could we be on the start of a short-term trend due to global economic uncertainty? Some of our sources seem to think that at the very least, today’s downward movement was inspired by investors seeking safer havens, with mortgage rates reaping the benefit of their investment activity. 30-year fixed rate conventional mortgages are now reported in a best-execution range between 4.125% and 4.25%. Affected borrowers may notice the changes reflected in closing costs rather than an actual rate adjustment. FHA mortgage rates continue in their best execution comfort zone at 3.75%. FHA rates often take | more...

February 2, 2017

Mortgage Loan Interest Rate Trends: Edging Higher

By Joe Wallace

Much attention was given to the Fed on Wednesday, but there was no hint of another planned rate hike; good news for now but that did not help mortgage loan rates in the end as stronger-than-expected jobs data helped put upward pressure on rates. Those who are not used to watching mortgage rate trends may be confused at this, seeing that what’s good for the economy will often be bad for mortgage rates. And that is not just perception. When economic data such as the Employment Situation Report shows strength, that often equals higher rates in the short term. Such reports do not directly affect mortgage loan interest rates, but investor reaction to that data can and often does. And such was the case on Wednesday, with stronger employment figures | more...

January 30, 2017

HUD Announces Agreement In Fair Housing Cases

By Joe Wallace

HUD has announced agreements with insurance companies in Ohio and Florida following an investigation into violations of Fair Housing Act regulations. We occasionally devote space to these issues because even in situations where the violations involve rental housing or other non-FHA loan transactions, they can affect borrowers seeking to apply for FHA loans. Some borrowers need rental housing to use in the planning stages of a mortgage before they can purchase a home, others may find themselves forced to house hunt due to job relocations, etc. Fair Housing laws protect Americans at all stages of the process of finding a home regardless of renting or buying. This most recent announcement of Fair Housing action from HUD states, “The U.S. Department of Housing and Urban Development (HUD) announced agreements with two | more...

January 25, 2017

Cash Back To The Borrower and FHA Loans

By Joe Wallace

Do FHA loans permit cash back to the borrower? We get many reader questions in our comments section about this subject. Some want to know if they can borrow more than the cost of the home and use the excess funds for personal use. Others want to know if cash-back refinance options are available on FHA mortgages. The rules that govern cash back to the borrower can be found in HUD 4000.1. As a general rule, FHA loans for “forward mortgages”, which means typical house purchases, do not allow cash back to the borrower. There’s an exception for money that was paid up front for something that was later permitted to be included into the loan amount. That would be considered a refund and is not forbidden by FHA loan | more...

January 24, 2017

Mortgage Rate Trends: Sharply Improved

By Joe Wallace

You may have noticed some extra coverage of mortgage rate trends in the last few weeks; rates have moved up and down in ways that seem to insist on added coverage, and Monday’s mortgage rate activity was definitely that. Rates recovered ground lost in the previous week and part of the reasons for that are also the reasons we saw higher rates in our last report; there is still a great deal of uncertainty among the markets and investors when it comes to economic policy, how the new administration will deal with overseas trade and other important issues. Mortgage rate trends currently reflect this uncertainty. Investors reacted to the earliest activity from the new regime in Washington D.C. and those reactions helped push mortgage rates lower. We’re now seeing a | more...

January 23, 2017

FHA Announces Suspension Of Earlier Policy Changes

By Joe Wallace

Earlier in January 2017, we reported on changes in policy regarding FHA Mortgage Insurance Premiums. Mortgagee Letter 2017-01 announced revised, lower Mortgage Insurance Premiums, plus the elimination of the distinction in rates based on the base loan amount according to the mortgagee letter. However, a new mortgagee letter announces that this change has been suspended. “This Mortgagee Letter…communicates that Mortgagee Letter 2017-01, reducing Mortgage Insurance Premiums for loans with Closing/Disbursement date on or after January 27, 2017, has been suspended indefinitely. FHA will issue a subsequent Mortgagee Letter at a later date should this policy change.” It is unclear at the time of this writing whether the suspended policy will be revised, or eliminated completely, but we will report on any future developments. Borrowers with FHA loans that have closing/disbursement | more...

How much can I borrow with an FHA refinance loan?

January 20, 2017

FHA Updates PACE Policy

By Joe Wallace

A new mortgagee letter updates FHA loan policy on properties bought with FHA loans that are “encumbered with a Property Assessed Clean Energy obligation”. Mortgagee Letter 2017-06 updates PACE policy starting with a reminder; “The terms and conditions of a PACE obligation may vary by state, local government, and PACE program. Generally, a PACE obligation is secured and collected in the same manner as a special assessment is treated by the local government; funds obligated are not paid directly by the Borrower to the party providing the PACE financing.” When the sale happens (including foreclosure sales), if a property has “outstanding PACE financing” the obligation will, according to the mortgagee letter, “continue with the property causing the new homeowner to be responsible for the payments on the outstanding PACE amount. | more...

January 19, 2017

Mortgage Rate Trends: Moving Higher

By Joe Wallace

While we don’t report on mortgage rate trends on a daily basis, we do give more time to that coverage when circumstances warrant, and this week definitely rates a closer look at the trends. Since our last report, mortgage rates moved decisively higher, pushing back in the direction of the mid-four percent zone (but not there yet). Some market watchers blame (at least in part) bond market performance for the most recent upward spike that pushed 30-year fixed rate conventional mortgages into a range between a best execution 4.125% and a best execution 4.25%. Prior to that, coming out of the weekend we saw more lenders at the lower end of that range. Could some borrowers see them most recent changes reflected in closing costs rather than actual mortgage rate | more...

January 12, 2017

Mortgage Rate Trends: Improving

By Joe Wallace

Before the new year, but after the 2016 election, mortgage rate trends were in what seemed to be an upward trajectory due to a variety of factors including uncertainty among investors regarding the new administration. But since the new year, we’ve seen more recovery, including the days following our last report. On Thursday, mortgage rates continued improving in small increments, with affected borrowers often getting the benefit in closing costs rather than an actual change in the mortgage rate. At the time of this writing, 30-year fixed rate conventional mortgages were at a best-execution 4.125%. That’s not a change from our previous report, but according to our sources more lenders are offering this best-execution rate now than since our last post. 4.125% could be at or near what some market | more...

January 11, 2017

FHA MIP Rates For 2017: Revised

By Joe Wallace

The FHA/HUD official site has announced changes to the FHA MIP fee structure for 2017. According to the latest FHA mortgagee letter, “FHA continuously strives to achieve the appropriate balance between meeting the housing needs of the borrowers that FHA’s mortgage insurance programs were created to serve, and also the requirement of minimizing the level of risk to the Mutual Mortgage Insurance Fund undertaken relative to the insurance of those mortgages.” “FHA has determined that the appropriate balance of its statutory operational goals now requires a reduction of the rate of annual MIP charged pursuant to Section 203(c)(2)(B) of the National Housing Act (NHA). As provided in this ML, the total annual MIP charged pursuant to NHA sections 203(c)(2)(B) and (C) for most Title II Single Family forward mortgages has | more...