NAR Letter on FHA Premiums
On April 2, 2014, President Steve Brown sent a letter to the Department of Housing and Urban Development (HUD) with concerns about the Federal Housing Administration’s (FHA) high annual mortgage insurance premiums and mortgage insurance that is required for the life of the loan. Home purchases are becoming increasingly out of reach for many qualified borrowers who rely on FHA financing.
President Brown’s letter notes that it is possible to increase the upfront premiums and lower the annual MIP while continuing to replenish the Mutual Mortgage Insurance Fund. This will slow the rate of prepayments that are having a negative effect on the fund, while providing more access to potential homebuyers who are not being served by the private market.