FHA Changes Effective 2010

Congress,  in an effort to stabilize FHA has passed HR 5981 which Obama is expected to sign. This bill, “General and Special Risk Insurance Funds Availability Act”, is intended to allow FHA to increase its annual premiums for single family homes. What does this mean for home buyers today? It means it will cost you significantly more to finance your home if you get an FHA loan after 9/7/10. In previous posts I warned that FHA was going to make serious changes to its programs to remain solvent. I actually expected these changes in the first quarter of the year but they waited until the 3rd. This will permit FHA to increase its annual premiums from .55 percent to 1.55%. The rub is that the bill purports to save you money up front but boy do you get hit in the annual premium

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