The Federal Housing Administration (FHA) announced last week it is pushing back the implementation date for new premium structures on FHA-insured mortgages to Oct. 4 from the original date of Sept. 7.
Following FHA Commissioner David Stevens’ recent announcement that up-front premiums for FHA-insured mortgages would be reduced beginning Sept. 7 from 2.25 percent to 1 percent, lenders expressed concerns that they would need more than five weeks to update loan disclosures and computer systems.
FHA previously raised up-front premiums from 1.75 percent to 2.25 percent in April to cope with rising losses on FHA-guaranteed loans. The Obama administration promised to reduce up-front premiums if Congress gave it the authority to raise annual premiums beyond their statutory limit of 0.55 percent. HR 5981, legislation raising the statutory limit on annual premiums to 1.55 percent, was approved by lawmakers on Aug. 4 and has been signed by President Obama.
More information at: http://portal.hud.gov/portal/page/portal/ver-1/HUD/federal_housing_administration/docs/BottStatementPremiumChanges.pdf
