Homebuyers who will be applying for FHA or VA loans will be pleased to learn that MIP and certain funding fees have been decreased for each of them respectively.

FHA MIP is Reducing

As of March 20^th, 2023, monthly mortgage insurance premiums (MIP) are decreasing by 30 bps.

The savings for around 850,000 borrowers over the next year are estimated to add up to around $678 million combined.

According to HUD, “For the same borrower with a mortgage of $467,700 – the national median home price as of December 2022 – FHA’s annual MIP reduction will save them more than $1,400 in the first year of their mortgage. In addition to providing overall savings to borrowers, a lower annual MIP can also help more people qualify for a mortgage.”

Certain VA Funding Fees are Decreasing 

Borrowers looking to apply for VA mortgages will be pleased to know that funding fees are decreasing for mortgages that close on or after April 7^th, 2023 and before November 14^th, 2031. You can find out more in the chart below.

The reduced funding fees only are for buying a home or building one using a VA loan, not for refinancing. They also are only available when putting 5% or more down with a VA mortgage.

Apply Now for a VA or FHA Loan in Florida

If you have questions about the reductions to FHA MIP and certain VA funding fees, we can answer them during your consultation for a home loan. If you are ready to apply for an FHA or VA mortgage now in Miami or anywhere in FL, please give us a call today at (786) 220-1100. We are excited to help you move affordably into your new home.

As a homebuyer in or around Miami, there are a number of different types of mortgages you can choose from, one of which is an FHA loan. This type of mortgage is insured by the Federal Housing Administration.

Why should you consider an FHA mortgage? Following are a few key reasons.

Things You Should Know About FHA Loan

1. Your credit score or DTI ratio could use some work. If your credit score or debt-to-income (DTI) ratio disqualify you from applying successfully for a competitive conventional mortgage or another type of loan, you still may qualify for an FHA loan in Miami. Even if your credit score is as low as 580, you might be able to get an FHA loan, even though such a low score might prohibit you from qualifying for a conventional home loan. There is also more leeway if your DTI ratio exceeds the ceiling for conventional mortgages. Your DTI ratio could be as high as 57%, and you would still potentially qualify. The restriction is set at around 43% for a conventional mortgage. While many first-time homebuyers have issues with their DTI ratio or credit score, repeat homebuyers can find themselves in the same predicament. An FHA mortgage is a suitable solution in either situation.
2. You cannot afford a higher down payment.
3. Maybe you qualify for a conventional mortgage, but you would need to put down 20% to purchase a home. If you cannot afford to put down 20%, an FHA mortgage may be the answer you are seeking. Say your credit score is 620. While you could get a conventional loan with that credit score, you might have to put a high down payment on a home. But that score would also qualify you for an FHA mortgage with just 3.5% down. Indeed, if you have a credit score of 580, you will still qualify for a 3.5% down FHA loan even though you would not qualify for a conventional loan at all.
4. You want to keep interest rates low. Just as a high down payment may be required if you qualify for a conventional mortgage with your existing credit score and DTI ratio, higher interest rates may be charged as well. But with an FHA mortgage, you might qualify for significantly lower interest rates even with the same DTI ratio and credit score.
5. Reduce closing costs with an FHA loan. The seller is permitted to cover up to 6% of the closing costs if you purchase a home with an FHA mortgage. In some cases, this might even eliminate your closings costs, as they will typically range between 2% to 5% of the purchase price.
6. Refinance from a hard money loan. Another reason to consider an FHA mortgage is if you have already purchased a home, but you took out a hard money loan to do so for credit-related reasons. Hard money loans often carry high interest rates. By refinancing, you can significantly reduce your interest rate with an FHA mortgage.

We Are Your FHA Loan Miami Experts

Whether you are trying to purchase or refinance a home in Miami or anywhere in the state of Florida, Lending Bankers Mortgage can connect you with an affordable FHA mortgage. To apply for an FHA loan in Miami now, please give us a call at (786) 220-1100.