Carl Horst Chief Executive Officer at Cincinnati Area Board of REALTORS | LinkedIn
Carl Horst Chief Executive Officer at Cincinnati Area Board of REALTORS | LinkedIn
The Federal Housing Administration (FHA) has recently updated its policies by increasing the fees mortgage servicers can charge when processing an assumable loan. Specifically, the FHA has doubled the allowable fees from $900 to $1,800.
Government-insured mortgages have the unique feature of being assumable to homebuyers. Assumable loans create opportunities for those with FHA mortgages struggling to sell their homes in high-interest-rate environments and consumers who wish to purchase but are sidelined because of higher monthly payments. However, many practitioners report delayed transaction times, often 30-60 days or more, as the time and work needed to underwrite and process the assumption does not correlate to the amount servicers can charge.
The National Association of Realtors (NAR) commends FHA for increasing the allowable fees, which it believes will help facilitate transactions and assist homebuyers and sellers. "Read NAR’s Letter to FHA."
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