Industry NewsMortgage

FHA premiums face new restructuring

Congress OKs annual premium increase
Published on Aug 5, 2010

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by CareyBot

Upfront premiums for FHA-guaranteed loans could soon be reduced by more than half, but annual premiums on the government-sponsored mortgage insurance are expected to nearly double now that Congress has given FHA authority to revamp the way premiums are structured.

Faced with rising losses on FHA-guaranteed loans, the Department of Housing and Urban Development (HUD) hiked upfront premiums in April, raising them from 1.75 percent of the loan being insured to 2.25 percent.