NAR continues to push FHA to lower the mortgage premiums. Today, FHA fees make up nearly 25 percent of a monthly mortgage payment. NAR has been supportive of HUD's plans to develop a new program called Homeowners Armed with Knowledge (HAWK) that would reduce premiums for first-time buyers who participate in homeownership counseling. Unfortunately, Congress eliminated the program as part of the Cromnibus Appropriations bill that funded much of the government through September 30, 2015.
Last week, NAR testified before the Senate Banking Committee about the high costs of FHA. FHA is charging borrowers historically high rates and requiring them to pay mortgage insurance for the life of the loan, with no opportunity to cancel other than to refinance into a non-FHA product. NAR believes this is simply disenfranchising the typical FHA borrower, and preventing a significant portion of qualified borrowers from buying a home.
Before leaving for the holiday recess, Senator Barbara Boxer (D-CA), in concert with NAR, worked with 17 other Senators to send a letter to HUD Secretary Castro asking him to set FHA premiums at a level that "balances both sustainability and affordability." We will continue to work with FHA and Congress on reducing these historically high costs for American families.
NAR letter to FHA on premiums