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FHA Mortgage Insurance Premiums reduced by 30 basis points-what this means for consumers

March 5, 2023 by Scott Sheldon

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For folks looking to purchase or refinance a home with the FHA Loan, the Federal Housing Administration has just announced a reduction to their private mortgage insurance premiums by 30 basis points. This is a step in the right direction to help drive home ownership. Here is what this means for your bottom line…

Presently on an FHA loan, the annual premium is 0.85%. So if you have a loan amount of say $300k the monthly PMI is present at $212 per month.

On March 20th, these changes get reduced by 2.55% earmarking a 30-basis point reduction in the annual paid mortgage insurance premium.
So using our example for $300k the new annual premium will be $137/month.

In this example, it lowers the payments for a borrower to $75 a month. Does this help? Absolutely, does and it helps drive homeownership for families looking to purchase homes in America today. However, this same goal could be accomplished by paying off a credit card that has a $75 per month payment on it or more for the same benefit than waiting for this change to potentially take place. However, that being said this does still provide a net tangible benefit to the borrower. A more opportunistic approach that could be beneficial to home loan borrowers going forward would be to look at maintaining a good credit score to the best of their ability, keeping their debts low, and best preparing themselves personally and financially for buying a home. This change does help people who are otherwise supportive of getting prequalified to buy a home.

If you are looking to buy get pre-qualified for a home loan, start by getting a free rate quote today.

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Filed Under: Pre-Approval, Purchase Mortgage Loans Questions and Answers, Uncategorized Tagged With: 2017 FHA Loan Limits, FHA, fha home loan, FHA home loans, FHA loans to buy a house, FHA mortgage, fha mortgages with student loans, FHA preapproval

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2455 Bennett Valley Road C107
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Corporate Office 14511 Myford Road, Suite 100, Tustin, CA 92780. We at New American Funding take great pride in our customer service and make it our number one priority. We encourage you to contact us for complaint resolution or any post-closing questions you may have regarding the servicing of your loan. We strive to have your experience with New American Funding a stellar one. In the rare case that our service did not meet your expectations, please call our customer care hotline at 1-800- 450-2010, ext. 7100 or you may contact us by email customerservice@nafinc.com. Please leave a detailed message and we will follow up with you no later than the end of the next business day. If you are using a screen reader or other auxiliary aid and are having problems using this website, please call 800-450-2010 Ext. 7100 for assistance.

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