Next month, the Federal Housing Administration plans to build up it’s finances by requiring anyone receiving a FHA loan with less than 20% down to carry mortgage insurance for as long as they have the loan. Previously it was only required to carry mortgage insurance until the loan balanced reached below 78% of the home’s value, when it could be cancelled.
As the largest low down loan insurer, the FHA is using this new rule as a big part of a larger plan to boost it’s finances. A smaller boost will come from last months raised mortgage insurance premiums to an average of 4.7%. These changes among others are estimated to lock in $10 billion in the next three years.
To see the full article: http://finance.fortune.cnn.com/2013/05/02/fhas-solvency-plan-isnt-fair/?section=money_realestate&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+rss%2Fmoney_realestate+%28Real+Estate%29