Now that Federal Housing Administration (FHA) has announced that its Mutual Mortgage Insurance Fund (MMI) has returned to solvency we may see relief. The fund was at risk due to the collapse in housing prices and huge numbers of delinquencies. This is good news as FHA has not been the go-to loan since changes were made to fees four different times in the past four years; and then making mortgage insurance permanent to the loan in 2013. Most Oregon families will try for USDA first, then look at FHA next. It’s normal to have looked at both programs during the approval process. FHA will reduce the annual premiums new borrowers will pay by half of a percent. Annual MIP will be reduced from 1.35% to .85%. New rules also state that the annual (monthly) Mortgage Insurance is only reduced to 11 years IF the loan is a 15 year or 10% down Loan-to-value.
