January 29, 2015
The reader is asking about FHA loan case number cancellation requests made possible for a limited time to help qualified FHA borrowers take advantage of the new, lower annual Mortgage Insurance Premiums announced earlier this month by the FHA and HUD.
We wrote about this in a blog post titled, FHA Mortgage Premium Cuts Begin Today. That article includes the following information:
“On Thursday, January 8, 2014, the FHA and HUD issued a press release announcing a cut to the FHA’s required annual mortgage insurance premiums, also known as MIP.
According to the press release, “As the nation’s housing market continues to improve, U.S. Housing and Urban Development Secretary Julián Castro today announced the Federal Housing Administration (FHA) will reduce the annual premiums new borrowers will pay by half of a percent. This action is projected to save more than two million FHA homeowners an average of $900 annually and spur 250,000 new homebuyers to purchase their first home over the next three years.”
In order to help home owners who might have been caught between the announcement, their loan approval, and their mortgage loan closing date, the FHA has temporarily approved a procedure where lenders can cancel an existing FHA case number for a loan that has not closed yet, and apply to have a new FHA loan case number applied.
The new lower FHA MIP took effect on January 26, so all FHA loans with case numbers assigned on or after that date would have the new lower MIP, saving a typical borrower as much as $900 a year.
Borrowers who have not yet closed their FHA mortgages could ask the lender to apply to have the FHA case number cancelled and a new FHA loan case number assigned–however this practice is only possible for 30 days starting from January 9 2015 when the original FHA Mortgagee Letter about the policy was issued.
Borrowers who have already closed their loans are not eligible for this case number cancellation and re-assignment.
Do you have questions about FHA home loans? Ask us in the comments section.