[quote=HLS] . . . With FHA loans it is possible that MIP payments will go up, making a refi less attractive, even at a lower interest rate.
I believe FHA is a problem, not a solution.[/quote]
Yes, HLS, the already-exorbitant FHA MIP just went up this past April 1 and it very well could go up again, since these loans are losing more money every month that goes by.
I predict the program will be insolvent within two years from today as there is not enough of an insurance “cushion” combined on all the recent high-ceiling loans they made in recent years.
FHA IS the problem. The officials running the program are rock-dumb. In the last decade its ceiling has exploded into levels sufficient to buy a “luxury home” in SD County with a 3.5% downpayment! This is NOT what the FHA 203b program was put in place for! Its lending limit should be no higher than $300K in SD County and that is really pushing it. The program was orginally put in place in 1934 to give first-time and/or moderate income buyers a “leg up” in a home purchase for a principal residence. Here are some examples of properties (and the homebuyers who will purchase them) for which the program was intended to serve:
