Quantcast

HUD is making homeownership more affordable for millions of Americans with its plan to cut the mortgage insurance premiums new borrowers will pay. The announcement of a .50% rate drop was projected to spur 250,000 new first-time home buyers to get FHA loans during the next three years.

FHA Mortgage Loan Rates

October 17, 2017
FHA Rates for October 17, 2017
Offering 30 Year Fixed Mortgages
Offering 15 Year Fixed Mortgages
Use our mortgage calculators
to see what you can afford!
FHA.com is a private company, is not a government agency, and does not make loans.

Prequalify Now!

Compare mortgage rates for your refinance or home purchase loan.

CHOOSE A LOAN TYPE

then
get
your

FREE CREDIT SCORE

Do you know what's on
your credit report?
The Path to Homeownership
FHA.com is a private company, is not a government agency, and does not make loans.

FHA Mortgage Insurance Reduction of .50% for New Loans in 2015

FHA Loan Borrowers Can See $900 Annual Savings

HUD is making homeownership more affordable for millions of Americans with its plan to dramatically cut the mortgage insurance premiums new borrowers will pay. Since 2010, insurance premiums on FHA-backed mortgages have jumped to 1.35%, pricing hundreds of thousands of creditworthy borrowers out of the housing market.

The Obama administration’s announcement of a .50% rate drop is projected to spur 250,000 new first-time homebuyers to get FHA loans over the next three years. This would add to the approximately 800,000 households who use FHA annually. FHA’s premium reduction took effect for mortgages with case numbers assigned on or after January 26, 2015, and did not affect loans that had already closed.

Julián Castro, Secretary of the Department of Housing and Urban Development (HUD), said the reduction will save the average borrower $900 annually. "Since 2009, the Obama Administration has taken bold steps to reduce risks in the mortgage market and to protect consumers. These efforts have made it possible to take this prudent measure while also ensuring FHA remains on a positive financial trajectory. By bringing our premiums down, we’re helping folks lift themselves up so they can open new doors of opportunity and strengthen their financial futures."

The increases that took the rate to 1.35% were implemented to stabilize the health of FHA’s Mutual Mortgage Insurance Fund (MMIF). A byproduct of protecting this fund was that it eliminated “a lot of the people that FHA is designed to help, and that’s the lower-income and first-time buyers,” said Chris Polychron, the president of the National Association of Realtors.

Loans backed by FHA are popular because the FICO score requirement of 580 is lower than what is required for conventional mortgages and the down payment can be as low as 3.5%. The lower mortgage insurance premium will increase its appeal as these rates move towards pre-crisis levels. Mr. Castro emphasized, however, that underwriting standards would not be relaxed. Buyers must still demonstrate their ability to qualify for a mortgage and pay it back on time.

See also: Current Mortgage Insurance Premium (MIP) Rates.

FHA Loan Articles and Mortgage News

Read About FHA Requirements, Updates, and Guidelines
FHA Loan Rules for Down Payment Gift Funds

March 22, 2017 - Borrowers wishing to purchase a home with an FHA loan may need some help with the down payment. There are rules that permit a borrower to receive such outside help, but the source and purpose of these funds are carefully regulated under FHA mortgage loan rules.

Can Collection Activity Hurt Your FHA Loan Chances?

March 15, 2017 - Credit issues worry some FHA loan applicants. Not knowing how the lender will interpret some kinds of negative credit information causes a lot of anxiety for new borrowers. However, having a collection account on your record may not be an automatic barrier to getting an FHA mortgage.

FHA Lowers Mortgage Insurance Premiums for 2017

February 10, 2017 - The Federal Housing Administration is lowering mortgage insurance premiums on FHA mortgage loans in 2017. When you purchase a home with an FHA mortgage, part of your mortgage payment includes a required annual mortgage insurance premium (MIP).

FHA Loan Debt to Income Ratio Rules for 2017

December 8, 2016 - Your FHA loan options in 2017 include new purchase loans, reverse mortgages, cash-out FHA refinance loans, and much more. Borrowers should take some time to review their last 12 months of credit and loan repayment history in preparation for the new loan.

Income and Debt Ratios for FHA Mortgages

October 31, 2016 - What does a borrower needs to know when preparing to apply for an FHA mortgage? There is a list of items to pay attention to that does include FICO scores; you may find that lenders are looking for FICO scores averaging between 620 and 640.