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FHA Insurance Premiums Hindering Home Loan Activity

May 4th, 2011

Home loan applications fell again this week as more and more potential borrowers are weary of the recently raised FHA insurance premiums.  Home loan rates are still ridiculously low but the monthly mortgage insurance payments are not affordable for many applicants that are shying away from the FHA loan program. Recent surveys have indicated that first time home buyer loan applications have soared as a result of the relaxed guidelines.

A few weeks ago HUD raised FHA premiums for the second time in the last 6 months.  The insurance rate hike only effect new home buyers and homeowners refinancing with FHA.

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