When markets are on very shaky ground, everyone hangs on the way sentences and wording come out of Fed Chairman Ben Bernanke’s mouth. So of coarse since he is talking later on this Friday, all eyes are on his mouth, well at least the words coming out of it. Here is what CNBC has to say about what might take place, hope you enjoy
Yes, the cost of an FHA mortgage is going up for any new case id numbers ordered past September 7th, 2010. The mortgagee letter has not come out yet but it was passed through congress (HR 5981) for this to take place. Here is the break down:
Old:
2.25% Upfront mortgage insurance premium
.55% Monthly payments
NEW:
1.00% Upfront mortgage insurance premiums
.85 to .90% monthly and HUD could raise to 1.55% max when needed.
Well, you might be thinking this is a good deal because the UFMIP went down a lot and monthly barely went up…….well think again. Here is a video showing how this is just increasing the costs a lot more for homebuyers.
Please before making laws and regulations, consult with a panel of experts from the industry and listen to the actual feed back before making laws and regulations. I know our representatives have tons of people telling them what to do……..but please seek out experts first……and not just a few, have a panel of them. Perfect example is the new GFE that went from 1 page to 3 pages. The GOOD thing is this form makes the fees stay within reason from the time of application to closing so no surprise fees for borrowers. The BAD thing is you forgot to check how different states collect certain fees and the buyers actually get a credit for lets say taxes for the time the seller was living in the property. Also don’t forget FHA collects an upfront mortgage insurance fee up front that gets financed back into the mortgage amount if borrower chooses that option. Last thing, what if the seller was giving a credit on the sales contract? These credits do not show up on the GFE, so please fix it!
Well, here is a video the great guys at Thinkbigworksmall did about HR 600 House bill that is taking us right back to where we were doing loans before. Please make up your mind……seller to help the buyer out for down payment and closing costs or not help the buyer……..let us know please Mr. Government.
