The federal government said Wednesday that it’s lowering the cost of certain federal mortgages by an average of $800 per year, lowering housing costs for an estimated 850,000 homebuyers and homeowners in 2023.
The premium is a monthly fee that homeowners with FHA-insured mortgages pay to have their loans insured, and is paid on top of their monthly principal and interest payments. The average home purchased with an FHA-insured mortgage is on average less than $270,000. In contrast, the median price of an existing-home in the U.S. was $359,000.
“The lower premiums will expand homeownership opportunities by lowering mortgage payments for qualified FHA borrowers, providing critical relief from the steep rise in mortgage rates and home prices just in time for the spring buying season,” said Bob Broeksmit, president and CEO of the Mortgage Bankers Association.