If you're a home shopper in the USA today, chances are you're reading news about rising rates. Buyers rejoice! The Department of Housing and Urban Development (HUD) along with the Federal Housing Administration (FHA) and the Vetarns Affairs (VA) announced three changes that will impact anyone shopping for a home in 2023.
Covid-19 Guidelines End Today March, 1, 2023.
When covid hit, lenders were given exceptional guidelines that allowed for previously unheard of execpetions; such as verification of business, employment, mortgage history, and income gaps. The sunset today.
Big savings for FHA loans will begin on March, 20, 2023.
Meanwhile, the FHA has reduced its annual mortgage insurance premium by 0.30 percentage points, from 0.85% to 0.55% for most new borrowers. These changes will help veterans and first-time homebuyers save money and make homeownership more accessible and affordable. The reduction in fees shows the government's commitment to supporting homeownership and building strong communities and a robust economy.
Example: a $400,000 mortgage will save $1,200 per year.
Vice President Harris and Department of Housing and Urban Development (HUD) Secretary Fudge will travel to Bowie, Maryland, today to announce that HUD, through the Federal Housing Administration (FHA), will reduce its annual mortgage insurance premium by 0.30 percentage points, from 0.85% to 0.55% for most new borrowers. The mortgage insurance premium is the monthly fee that homeowners with FHA-insured mortgages pay to insure their mortgages, which they pay on top of their monthly principal and interest payments. White House Briefing Room
Big savings begin on loans closed on or after April, 7, 2023.
The recent changes made by HUD for VA and FHA loans will result in significant savings for prospective homebuyers. The VA has reduced the funding fee for purchase or construction loans, as well as cash-out refinance transactions by 15 bps, which will come into effect for loans closed after April 7th, 2023.
This means that you could potentially save thousands of dollars on your VA home loan.
The VA has reduced the funding fee by roughly .15% across the board, and for those using the program for the second time or looking to purchase a home or construct a property with less than 5% down payment, the fee has been reduced by a whopping .3%.
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Surviving family members
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What are the minimum service requirements for VA loan benefits?
If you serviced between August 2, 1990, and the present (Gulf War period to present)
You meet the minimum active-duty service requirement if you served for:
At least 24 continuous months, or
The full period (at least 90 days) for which you were called or ordered to active duty, or
At least 90 days if you were discharged for a hardship, or a reduction in force, or
Less than 90 days if you were discharged for a service-connected disability.