Since FHA’s reserve account has been under the required 2%, HUD has decided to start raising upfront mortgage insurance premiums (1.75%-2.25%), increasing down payment for lower credit scores, and reducing allowable seller concessions from 6% to 3%. These changes will take affect this spring, possible as early as April. What that means for a buyer is buying a house in months to come will cost more than today. FHA has taken up 30%-40% of the purchase market due to their low down payment and flexible credit criteria so this will impact A LOT of first time buyers.
Between the anticipated rate increases once the government steps out of the market and higher cost to get a low down payment loan…home financing will inevitably get more expensive. If you have been on the fence about buying a home, delaying this process any longer will cost you more long term. Call me today at 608-214-9844 Scott Larson Towne Square Realty