We are excited to share with you the big savings announced for FHA mortgage borrowers in 2023!
We are thrilled to announce the latest news that can help our clients save big on their FHA mortgage. On 23rd February 2023, the Federal Housing Administration (FHA) announced a significant reduction in the annual mortgage insurance premiums (MIP) for FHA borrowers. This announcement is a fantastic opportunity for FHA borrowers to save thousands of dollars over the life of their mortgage. As a leading FHA mortgage lender, we want our clients to know about these savings and how they can take advantage of them.
What is FHA Mortgage Insurance Premium (MIP)?
FHA mortgage insurance premiums (MIP) are fees charged to borrowers who take out an FHA-insured loan. This fee is paid by the borrower to the FHA and is used to protect the lender in case the borrower defaults on the loan. MIP is divided into two parts: the upfront MIP and the annual MIP. Upfront MIP is paid at the time of closing and is usually 1.75% of the loan amount. The annual MIP is a fee that is added to the borrower’s monthly mortgage payment.
How much can FHA borrowers save?
Under the new announcement, the annual MIP rate for most FHA borrowers will drop from 0.85% to 0.50%. This is a significant reduction of 0.35%, which can save FHA borrowers thousands of dollars over the life of their mortgage. The White House is reporting the average yearly savings with the new rates will be over $800 per year.
Here is an image showing the matrix of FHA MIP:
How can FHA borrowers take advantage of these savings?
The good news is that FHA borrowers do not need to take any action to receive these savings. The new MIP rates will automatically apply to new loans and existing loans that are endorsed on or after 1st April 2023. If you are an FHA borrower with an existing loan, you should contact your lender to see how much you can save by refinancing your loan. Refinancing your loan can help you take advantage of the new MIP rates and save thousands of dollars over the life of your mortgage.
Why choose Heritage Home Loans for your FHA mortgage?
At Heritage Home Loans, we specialize in FHA mortgages and have helped thousands of borrowers achieve their dream of homeownership. We offer competitive interest rates, flexible terms, and personalized service to ensure that our clients get the best possible mortgage for their needs.
We are committed to helping our clients save money and achieve their financial goals, which is why we are excited about the latest news on FHA MIP rates. If you are looking to buy a home or refinance your existing FHA mortgage, contact us today to learn more about how we can help you take advantage of these big savings.
Contact us today to learn more about how we can help you save money on your FHA mortgage. Or click below to start your Purchase or Refinance application and see how much you can save!