The Government to the Rescue

Here is something that will effectively be shouted from the housetops as it were: a press release this morning says that on Thursday President Obama will announce that FHA monthly MI premiums will drop from 1.35 to .85%.  A report out today shows that FHA is currently only funding 10% of the market, compared to almost half of the loans issued a few years ago.  Cheaper MI coupled with lower interest rates will go a long way in helping FHA return to its former glory in being a bastion of home ownership. While I highly doubt that our Commander in Chief is the brain behind more affordable mortgage loans, I certainly appreciate him getting behind it, and I believe that Mr. and Mrs. America will too.

A Word From our Sponsor

This chart from Freddie Mac shows the history of interest rates over my lifetime and should be an encouragement to just about anyone to get a mortgage.

FHA just announced that they will not extend the “anti-flipping” law past the end of this year.  What that means is that FHA will no longer finance a property if the seller has not held title for longer than 90 days–unless of course the owner is them (HUD), Fannie, or Freddie, and certain non-profits.

On the economic reporting side, we have pretty good news out today across the board:

  • Import Prices decreased 1.5% while Export Prices only declined by 1.0%
  • 3,000 fewer people filed for unemployment last week than the week prior
  • Retail Sales bumps up 0.7%, more than double last month’s gain
All of this is helping stocks regain yesterday’s losses, causing bonds to give back yesterday’s gains.