This is a big deal. For a typical FHA loan 3.5% down the Monthly mortgage insurance is 0.85% or for a $500k home that would be $341 monthly. The new annual premium will change to 0.55% or $221 monthly.

There are other premium changes for high balance loans, shorter amortization and larger down payment. This change will take effect on March 20th.

More than 80% of FHA borrowers are first-time homebuyers.

With regards to yesterday’s blog regarding the PCE report due out today, inflation rose 0.6% in January, Hotter than estimates. Y/Y readings were above estimates and moving in the wrong direction.

On a positive note, New Home Sales rose 7.2% in January.

Have a great weekend and always available if you have any questions.