You’ve probably heard of the “Golden Rule.” Have you heard the other version?
He who has the gold … makes the rules!
FHA has the gold. Their loans are one of the most popular loans due to the fact that they only require a 3.5% down payment. The FHA recently announced that their monthly Mortgage Insurance Premiums (please do not go to sleep or let your eyes glaze over at this point) are going up .25% starting April 18th.
What’s That Got to Do With My Home Search?
Actually… a lot, depending on the size of your loan. This price increase will impact you directly every month you make that lovely mortgage payment. You need to know the deadlines.
Continue with the rest of this post to see how much it would effect someone purchasing a home for $160,000 and what you can do to avoid paying something … you might be able to avoid.
John and Mary Homebuyer have been on the Internet looking at homes for months. They have focused in on a couple of areas where they might want to live. A home costing around $160,000 would fit within their budget. They have decided to go with the FHA loan because they could only put together a 3.5% down payment. How this increase will impact them.
You read it right. An increase in their payment of $33 a month … every month. Or look at it as almost $400 a year … for quite a few years! Keep in mind that this monthly rate could be higher or lower depending on the size of your loan.
What You Can Do to Avoid the Price Increase
All lenders have to file an order to FHA for the loans they are processing. The Lenders deadline is April 18th which is a Monday. To be on the safe side, you should try to have an accepted contract on your new home and financing settled with your lender before this date. Ideally, we would recommend having everything ready by April 14th.
THE BOTTOM LINE
You will need to have found your home and have an accepted contract no later than April 14th to have your best shot at avoiding the upcoming price increase.
Call Finding Homes for You, your real estate rapid response team today at 636-532-4200.
We only work for buyers, have a stream-lined team of professionals assembled who can kick start your home search and help you meet this deadline and save you money!