The Federal Housing Administration (FHA) recently announced a major cut in mortgage insurance premiums. The cut applies to new mortgages scheduled to close on or after January 27, 2017, and is expected to provide added help for middle-class families looking to buy their first home or to upgrade to a new home this year. The added savings associated with this move by the FHA may even counterbalance rising mortgage rates predicted to continue through the end of 2017.
A Major Move on Mortgage Insurance Premiums for the FHA
In November of 2016, many market analysts speculated that the FHA might reduce the cost of mortgage insurance. The FHA’s Mutual Mortgage Insurance Fund had experienced its fourth consecutive year of growth and was close to its threshold of 2 percent. By lowering the cost of mortgage insurance premiums, the FHA can provide added help for home buyers in the lower and middle income brackets.
Mortgage Insurance vs. Title Insurance
For buyers, lenders and sellers, working with a reputable title insurance company can provide added financial protection against claims and liens on the property in question. Mortgage insurance, by contrast, is a closing cost paid by the buyer to protect the mortgage lender against potential losses. Mortgage insurance is typically required for buyers who are seen as higher risk by lenders and who might not be able to obtain a loan without this added assurance.
Managing Closings Efficiently
As a leading title insurance company, Lakeside Title can provide expert help for lenders, builders and agents in making sure that real estate closings go smoothly. We can provide the information buyers and sellers need to achieve their goals. Call Lakeside Title Company today at 410-992-1070 to learn more about our expert services.