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Finally, some good news for low- and middle-income buyers! The FHA just announced lower interest rates on purchase insurance, beginning March 20.
New case files created after that date will see a 30% discount in the insurance rate for their loans, dropping from from 0.85% to 0.55%. This could result in a savings of $800 per year.
For example, if you were to get a $300,000 loan with a 3.5% deposit at the current rate, your insurance premium would be ~$205 per month. Under the new rate, premiums drops to ~$132. While this signifies a nice savings, it also means that you may qualify for a bit more home, as this lowers your debt-to-income ratio.
FHA loans are government backed loans insured by the Federal Housing Administration. Buyers using this program can put as little as 3.5% down, making the program appealing to first-time, low-, and middle-income buyers. Find out more about the interest rate reduction by clicking here. Find out more about FHA loans here.
Are you interested in purchasing a home with an FHA loan? Reach out to a qualified real estate agent for more information.
Disclaimer: Hi. I'm Ed! I am NOT a licensed real estate salesperson or broker. I am, however, currently studying to become a real estate agent, and hope to have my California real estate license by summer of 2023. All advice and information given on this blog is sourced from publicly available websites and common knowledge. Please reach out to a licensed real estate agent if you are interested in buying or selling a home!
