2013 Kentucky FHA Mortgage Changes to Mortgage Insurance

2013 Kentucky FHA Mortgage Changes to Mortgage Insurance.

via 2013 Kentucky FHA Mortgage Changes to Mortgage Insurance.

 

2013 Kentucky FHA Mortgage Changes to Mortgage Insurance

 

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2013 Kentucky FHA Mortgage Changes to Mortgage Insurance

Louisville Ky Mortgage Lender FHA VA KHC Kentucky Mortgage: Louisville FHA and VA Home Loans

  • FHA will raise the annual mortgage insurance premium paid by borrowers on most newKentucky FHA loans by 10 basis points, or 0.1 percent, which the agency expects will add $13 a month to the average borrower‘s monthly payments. FHA will also increase premiums on jumbo Kentucky FHA mortgages (those $625,500 or bigger) by 5 basis points or 0.05 percent, to 155 basis points — the maximum currently allowed by law. Certain streamline refinance transactions will be excluded from the premium increases, the agency said.
  • FHA will reverse a policy that automatically canceled required premium payments after loans reached 78 percent of their original value. Most Kentucky  FHA borrowers will now have to continue paying annual premiums based on the unpaid principal balance for the life of their mortgage loan. The agency estimates it lost billions of dollars in premium revenue on mortgages endorsed from 2010 through 2012 because of this cancellation policy.
  • Borrowers with FICO credit scores below 620 and a total debt-to-income ratio of more than 43 percent will not be eligible for processing through Kentucky FHA’s automated underwriting system, TOTAL Scorecard. Such will have to be processed manually, with lenders documenting compensating factors such as a larger down payment or a higher level of reserves.
  • FHA will propose an increased minimum down payment on loans between $625,500 to $729,000 to 5 percent from 3.5 percent. ”This change, coupled with the statutory maximum premiums charged for these loans, will help protect FHA and further facilitate its efforts to encourage higher levels of private market participation in the housing finance market,” the agency said.
  • FHA will crack down on lenders that advertise under the false pretense that borrowers can “automatically” qualify for an Kentucky FHA-insured loan three years after a foreclosure. Borrowers who have experienced a foreclosure must have re-established good credit and meet underwriting criteria, including the policy change outlined above for borrowers with credit scores under 620. FHA is also committed to a new housing counseling initiative that would apply to a number of borrower classifications, including borrowers with previous foreclosures, the agency said.

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Credit Scores and the Kentucky USDA Rural Development Loan Program

Joel Lobb (NMLS#57916)
Senior  Loan Officer
502-905-3708 cell
502-813-2795 fax
jlobb@keyfinllc.com

Key Financial Mortgage Co. (NMLS #1800)*
107 South Hurstbourne Parkway*
Louisville, KY 40222*

 

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