FHA Announces Lower Mortgage Insurance Premiums

Earlier this morning, the Department of Housing and Urban Development (HUD) made a major announcement that could have a significant impact on FHA borrowers. HUD Secretary Marcia Fudge revealed a plan to reduce the annual Mortgage Insurance Premiums (MIPs) currently charged to FHA borrowers by 30 basis points, or 0.3% of the loan balance.

This reduction will lower the premium from 0.85% to 0.55% for most FHA borrowers, which could benefit up to 850,000 borrowers in the coming year, saving them an average of $800 annually. This is great news for homeowners who may be struggling to keep up with their monthly mortgage payments.

Secretary Fudge explained that the reduction is part of a larger effort to make homeownership more affordable and to address longstanding disparities in homeownership. “Today, we are building on the steps we’ve taken to make homeownership more affordable, and HUD is acting to ensure people feel comfortable purchasing a home as they build toward their future,” she said.

For many FHA borrowers, MIPs are a necessary expense. These premiums help protect lenders in the event that borrowers default on their loans. However, they can add up over time and make homeownership more expensive for many families. This reduction in MIPs could help make homeownership more accessible and affordable for a wider range of borrowers.

At Citizens Financial, we’re excited about this news and the potential it has to benefit our customers. We’re always looking for ways to help our borrowers save money and make the most of their homeownership experience. If you’re an FHA borrower, this reduction in MIPs could be a great opportunity for you to save money and reduce your monthly expenses. Contact us today to learn more about how we can help you take advantage of this announcement and achieve your homeownership goals.