FHA has lowered their annual mortgage insurance premium by 30 basis points. What does that mean in real numbers?

FHA monthly MI on a 300K loan the current way… $212.50 per month
FHA monthly MI on a 300K loan the new way…. $137.50 per month

That’s a That’s a $75 savings each month, or $900 per year. $75 per month equates to about $10k in sales price. Your buyers pre-approved for $200K will now be approved for $210K…300k will now be pre-approved for $310K.. It can change the game!!

This will help lots of home buyers using FHA financing.

In more practical terms, think of it this way. If the FHA interest rate is 6.5%, this savings is like taking their rate to 6.125% for free. HUGE savings.

These numbers are based on 3.5% down. The MI is even cheaper if you put 5% or 10% down.

VA has also reduced their VA funding and reverted back to the previous fee from years ago.

The funding fee for 100% financing, zero down, went from 2.3% to 2.15%. On a 300K loan, that’s a savings of $450.

This change does not affect the monthly payment as much as the FHA change, but its still a good thing.

^{Information courtesy of Traci Waller of Crosscountry Mortgage. This is for informational purposes only and should not be relied on by you. Berkshire Hathaway Homeservices RW Towne Realty is not a mortgage lender. Contact Crosscountry Mortgage directly to learn more about it’s mortgage products and your eligibility for such products. NMLS# 512138 Equal Housing Opportunity Information is subject to change without notice. This is not an offer for extension of credit or a commitment to loan.}