|Announced yesterday. May help some buyers get off the fence and spur on business.|
"Annual Mortgage Insurance Premium Rate Reductions for Most Title II Forward Mortgages Announced Today
Today, the Federal Housing Administration (FHA) announced that it is reducing its annual Mortgage Insurance Premium (annual MIP) rates for most Title II forward mortgages with Closing/Disbursement dates on or after January 27, 2017. These annual MIP rate reductions will expand access to mortgage credit, and are expected to lower the cost of housing for the approximately 1 million households that use FHA annually.
Mortgagee Letter 2017-01, published today, provides detailed information about the annual MIP rate reductions, including a reduction of 25 basis points (bps) in the annual MIP rate for the majority of new FHA-insured mortgages. The new annual MIP rate for mortgages that fall into this category is 60 bps."
This part is ESPECIALLY COOL! >>>
Unlike previous annual MIP rate adjustments, the new annual MIP rates are being applied based on the Closing/Disbursement date of the mortgage and not on the FHA case number assignment date:
• The Closing/Disbursement date is the later of the date of the signing of the mortgage or the date of disbursement of loan proceeds, as entered by mortgagees in the FHA Connection (FHAC) system.
• Mortgagees with FHA cases in process do not need to request the cancellation of an existing FHA case number or obtain a new FHA case number to extend the annual MIP rate reductions to borrowers. The new annual MIP rates will be automatically applied based on the Closing/Disbursement date entered into FHAC by the mortgagee."
So basically, an FHA mortgage in escrow now will automatically get the lower MIP.