Skip to main content

January 26, 2015: Changes Ahead for Mortgage Financing

January 26, 2015:  
Changes Ahead for Mortgage Financing     

     Both FHA and Fannie Mae (Conventional Loans) have recently announced upcoming changes that will kick-in on January 26, 2015 ...  

     FHA has announced a 50 Basis Point reduction in Monthly Mortgage Insurance costs to Borrowers, resulting in most cases, a half-percent cut on MI charges.  

     An example of cost reduction realized:  

     A $200,000 Loan reaps an $83.33 per month savings.  That reduced Mortgage Insurance payment savings gives a Borrower MORE buying power, perhaps as much as $17,000 in price and/or loan approval.  

     It also means the Borrower realizes a reduction in their Debt-to-Income (DTI) Ratio of 1.56 Per cent at a given income amount ... of say $5,316 monthly.  Any one of these factors can be a "deal breaker, maker, or saver" moving forward in their transaction.  Estimates have been made that some 250,000 new Borrowers will be helped by these cost reductions over the next 3 years.

     HUD states that their Bottom Line in their Fund would not see significant reductions with this action.  Until recently their Fund was deeply in the "red".  That deficiency had resulted in their recent increases in their Mortgage Insurance charges.  

     Apparently, HUD's losses have decreased in recent months, as loans continue to be paid back at a higher percentage of on-time payments, coupled with a slowing Foreclosure rate.  All of these things hopefully mean good news for First-Time Homebuyers ... and especially those with Credit Scores below 680.

     Perhaps these changes come as a result of FHA losing some 30% of Market Share in recent months/quarters (while utilizing the higher cost Mortgage Insurance).  Or perhaps some competition proved inspirational.

     Fannie Mae's announcement bringing back their 3% Down Payment Program may have motivated FHA to act. Fannie Mae's 3% Program offers Interest Rates and Mortgage Insurance premiums that are VERY competitive to FHA's.

     No matter the reasoning, I'm hoping that these changes (especially as we head into the historically busier Spring sales season) will jumpstart our struggling housing market. And we'll experience a quicker, more sustained economic recovery as a result. 

     Fannie Mae's change, also coming on January 26th, is far less reaching, so I'm assuming that it will gain very little press coverage.  Be watching for my post on that change shortly ...

*  Hoping to Buy, Build, or Refinance a home in New Lenox, Will County, or elsewhere in the Chicagoland area?  Contact Me today!  I'll put my 37 years of Mortgage experience and expertise hard to work on your behalf.
     I can be easily found at:
Direct:  815.524.2280
Cell/Text:  708.921.6331
eFax:  815.524.2281
 Twitter Account of Gene Mundt, Mortgage Lender   LinkedIn Account of Gene Mundt, Mortgage Lender   Facebook Acct. of Gene Mundt, Mortgage Lender   Pinterest Acct. of Gene Mundt, Mortgage Lender   Digg Acct. of Gene Mundt, Mortgage Lender
 Trulia Acct. of Gene Mundt, Mortgage Lender   Zillow Acct. of Gene Mundt, Mortgage Lender   Lender411 Acct. of Gene Mundt, Mortgage Lender    Klout Acct. of Gene Mundt, Mortgage Lender    Gene's Chicagoland Blog/Gene Mundt, Mortgage Lender 
Gene Mundt, Mortgage Lender, a Lender with 37 years of mortgage experience, will offer you exemplary mortgage service and advice when seeking:  Conventional, FHA, VA, Jumbo, USDA, and Portfolio Loans in Chicago and the greater Chicagoland region, including:  The Lincoln-Way Area, Will County, (New Lenox, Frankfort, Mokena, Manhattan, Joliet, Shorewood, Crest Hill, Plainfield, Bolingbrook, Romeoville, Naperville, etc.), DuPage County, the City of Chicago, Cook County, and elsewhere within IL.  

Your Referrals are Appreciated! 



  1. Hi Nice blog. Your post really providing good information for me and also useful for me. Keep sharing such important things.


Post a Comment

Thank you for taking the time to read and comment on my post!

Popular posts from this blog

Property Addresses: Gettin' Down to the Nitty Gritty

Property Addresses:   Gettin' Down to the Nitty Gritty

Take just a second and read through the following statements ...

“The devil is in the details” 
... "in life, it is often the tiny details that end up 
being the most important"

"Get Down To The Nitty Gritty"

“Little details have special talents in 
creating big problems!” 

“Sweat the details”

"Success is the sum of details"

Details ...Details ... it's all about the details ...
     And I'll admit it, I'm a bit of a nerd about them.  My whole family is.  Details, the intricacies, the little things ... they matter to us.
When I was growing up, a typical conversation (and argument) between my brothers and myself at the dinner table or in the backyard centered around "details".  It didn't matter what the topic was, it was the minor differences ... the details about the topic ... that we argued about.  I'm sure we drove our parents crazy.  
Sports statistics and games ... minutiae rega…

Ready for Fall? It's Arriving Soon

Ready for Fall?  It's Arriving Soon

Friend ...

Maybe it's because football season has started. Maybe it's the kids being back in school. Or because the night air is cooler. But a sense of Fall has arrived here in Chicagoland ...

The Fall Season brings changes with it. Changes in temperatures. Changes to the clothing we wear. Our focus seems to shift with the coming of shorter days, falling leaves, and crisp air.

Fall can be the perfect time to do a multitude of things. You can prep your home for the upcoming winter weather ... or for Fall listing and sale. 

But whether you're moving on or staying put, Fall is a great time to declutter and organize your home inside and out ... and your finances too.

I've googled like crazy to find interesting articles filled with Fall info, ideas, tips, and photos. Articles that will help you usher the Fall Season in at your house. I hope you enjoy reading the articles offered below and that they inspire you to make any needed changes.


Paper or Paperless billing? Which serves YOUR needs best?

Paper or Paperless billing?  Which serves YOUR needs best?

These days, companies are under pressure to go "green" and become more environmentally friendly.  As a result, an increasing number of businesses are offering their customers a paperless option with which to receive and pay their bills. 

There are obviously many positives to be found within these paperless services:

Trees are saved  Reduced postage costs  Less paper documentation to organize or save/storePossible rewards for switching to paperlessPayments can often be made/posted same-dayAutomated payments can be set-upMore
But I can tell you from my vantage point as a Chicagoland/IL/WI Mortgage Originator, there are also negatives to be found within paperless methods.  For some of my mortgage clients, the choice of going "paperless" just hasn't worked well.

 For some, an email or text reminder regarding payment of bills has not been enough. They NEED a paper billing to arrive in their mail. 

Their paper bil…