If you're a prospective homebuyer looking to take out an FHA-insured mortgage, you might be in luck. The Biden-Harris Administration has announced a 30basis point reduction to the annual mortgage insurance premiums (MIP) charged to homebuyers who obtain an FHA-insured mortgage. This means that the annual MIP for most homebuyers will be reduced from 0.85 percent to 0.55 percent, potentially saving American families an estimated $678 million by the end of 2023 alone.

This reduction is good news for many families who are struggling with the high costs of homeownership, especially first-time homebuyers often rely on affordable FHA-insured mortgages. The savings can make a big difference in their ability to achieve their dreams of homeownership

The reduction applies to almost all Single Family Title II forward mortgages insured by FHA, including single family homes, condominiums, and manufactured homes. It also applies to all eligible loan-to-value ratios and all eligible base loan amounts. The average FHA borrower purchasing a one-unit single family home with a $265,000 mortgage will save approximately $800 this year as a result of FHA’s premium reduction. 

This reduction will be effective for mortgages endorsed for insurance by FHA on or after March 20, 2023. For more information, click here. 

Are you interested in purchasing a home this year? The Sharpe Mortgage Team would love to help you! Contact us today to discuss your options!