FHA to Lower Cost of MIP
In a move designed to bring more first-time homebuyers into the housing market, President Barack Obama said Wednesday the Federal Housing Administration (FHA), the government insurer of home loans, will lower its annual insurance premiums from 1.35 percent to 0.85 percent.
In a statement, the White House said the move was part of the president's efforts `"to expand responsible lending to creditworthy borrowers.'' The president is scheduled to talk about improvements in the housing market at a speech on Thursday in Phoenix, one of the hardest-hit markets of the housing crash.
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Stocks of the nation's home builders rose on the news Wednesday, while those of mortgage insurers fell.
"This action will make home ownership more affordable for over two million Americans in the next three years," said Julián Castro, U.S. Department of Housing and Urban Development Secretary. "Since 2009, the Obama administration has taken bold steps to reduce risks in the mortgage market and to protect consumers. These efforts have made it possible to take this prudent measure while also ensuring FHA remains on a positive financial trajectory. By bringing our premiums down, we're helping folks lift themselves up so they can open new doors of opportunity and strengthen their financial futures."http://www.cnbc.com/id/102318078
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