Mortgage insurance premiums not headed down: FHA

by Adam Smith10 Apr 2014
Don't expect mortgage insurance premiums to fall anytime soon, according to the commissioner of the FHA.

Speaking to the Mortgage Bankers Association conference, FHA commissioner Carol Galante said mortgage premium increases were necessary, MNI has reported. In a letter sent on Monday, the National Association of Realtors asked Galante to lower mortgage insurance premiums on FHA loans. But Galante told the MBA conference that "now is not the time".

Galante said the FHA has other initiatives to expand access to credit, MNI reported. These include a quality assurance program to ease lender concerns about making FHA loans.

As for mortgage insurance premiums, however, Galante said they were appropriately prices to the risk the FHA was assuming, and that increasing premiums was "absolutely necessary".

COMMENTS

  • by Chris Wagner | 4/10/2014 12:44:57 PM

    What planet goes Galante live on. Lower rates lower payments less chance of default through inability to pay.

  • by BILL | 4/11/2014 12:47:29 AM

    WRONG:
    RAISE THE UFMIP, THIS GIVES HUD IMMEDIATE MONEY, AND LOWER THE MONTHLY FEE.

    THIS MAKES PAYMENT AFFORDABLE AND HUD STILL GET THEIR INCREASE.

    RAISING THE MONTHLY HAS MADE OUR COMPNAY FROM BEING A 75% FHA COMPANY TO A 49% FHA AND 51% CONV! THEY ARE LOSING THEIR MARKET SHARE AND THEREFORE GETTING LESS INSURANCE PREMIUMS

  • by Tim Estes | 4/11/2014 10:53:27 AM

    I'd like to see the MIP reduced to the extent that it keeps adequate reserves but if the current premium creates a greater likelihood of default the borrower should borrow less or not at all.

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