Is the .25% reduction on monthly MI or UFMIP? When does it become effective? Thanks
While a nominal drop in the UFMI is nice–it’s a reduction of $1,000 on a $400,000 purchase–a far more beneficial move would be to restore the 25 bps reduction in the renewal (monthly) premium. Outgoing HUD Secretary Julián Castro had directed FHA to lower the monthly premium to .60% from .85%. On inauguration day, that change was rescinded, as the new president’s second official act.
At the time of the now-nullified change, the MMI fund was at 2.32% and growing. It would have lowered the monthly payment for someone buying a $400,000 home by more than $80 per month. It’s not trivial.
The administration claimed that the matter needed “more study,” but we have yet to see any indication that the people under current HUD Secretary and dining room set shopper Ben Carson (yeah, I know that was snide) is performing any such study.
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