The Federal Housing Administration – How it Got Started and How You Can Get Involved!
If you’re unfamiliar with the Federal Housing Administration’s history, you’ve probably heard about its mortgage insurance program. This government agency has revolutionized 주택담보대출 the mortgage market by collecting lenders’ mortgage insurance premiums. It also stabilized regional and local markets, and sets loan limits. Here’s how the FHA got started. Here are some interesting facts about the FHA. Here’s how it operates today. And how you can get involved!
FHA’s mortgage insurance programs revolutionized the mortgage market
Since the beginning of the financial crisis, the Federal Housing Administration has insured an unprecedented proportion of the mortgage market, with its programs helping to stabilize the mortgage market by providing countercyclical liquidity to banks and lenders. As a result, the FHA has backed over 3 million home-purchase loans, helping 2.7 million families to reduce their monthly payments. Without these programs, millions of homeowners might not have been able to obtain mortgage credit, sending ripples throughout the economy.
It collects mortgage insurance premiums from lenders
When a borrower applies for an FHA loan, they will be asked to pay an upfront mortgage insurance premium. The premium is collected by the lender, and it is forwarded to the FHA within 10 days of the loan closing. The purpose of the mortgage insurance premium is to help the FHA insure loans. The premium is split into two parts: the Upfront Mortgage Insurance Premium (UMP) and the Monthly Premium (MIP). The UMP is about 1.35% of the loan amount, or $1,350 for a $100,000 loan.
It sets loan limits
The Federal Housing Administration sets loan limits for new homebuyers each year, based on the price of homes in a given area. These limits vary by county, but are generally set at 115% of the median home price. The FHA’s maximum loan limits vary from standard to high-cost homes, depending on the county. These limits can be higher if the home has more than two units, such as an apartment building.
It tries to eliminate seller-financed down payment assistance
A nonprofit program that helps low-income buyers finance their down payment has exploded in popularity across the country, and the Federal Housing Administration is trying to get rid of it. The nonprofit pays a processing fee to the seller, who then increases the selling price to cover the nonprofit’s expenses. The nonprofit has helped more than 1 million low-income home buyers in the last decade, and in Seattle alone, more than seven thousand FHA-backed mortgages have been financed through the seller-financed down payment assistance programs. However, on Oct. 1 of this year, the Federal Housing Administration banned seller-financed loans from all of its insurance programs, which will likely have a negative effect on real estate sales.