Mortgage

Six-month anniversary: Will HUD implement FHA mortgage insurance premium cut?

HUD seems no closer to announcing a decision

Six months ago today, President Donald Trump became the 45th president of the United States, but today also marks the six-month anniversary of the suspension of a mortgage insurance premium cut.  

On inauguration day this year, just one hour after Trump was sworn into office, the U.S. Department of Housing and Urban Development stated a Federal Housing Administration mortgage insurance premium cut would be suspended. In fact, the suspension was the new administration’s first order of business after taking office.

Right before leaving office, the Obama administration cut FHA mortgage insurance premiums, marking the second time it reduced premiums in two years.

The cut was originally set to take effect on January 27 of this year, however, HUD Secretary Ben Carson explained the department needed to thoroughly examine the decision to cut before determining a course of action.

Now, six months later, the suspension still stands, with no information on when this will change. Some members of Congress think it is time to make a decision regarding the cut.

“After six months of indecision, it is long past time for the Trump Administration to follow through on the Obama Administration’s plan to reduce the FHA mortgage insurance premium rate by 25 basis points,” Rep. Joyce Beatty, D-Ohio, told HousingWire.

“At a time when homeownership rates are at a 50-year low, the federal government can do more to make homeownership a reality for countless families,” Beatty said. “Lowering FHA MIP rates will put hundreds of dollars back into homeowners’ pockets and also reduce financial barriers for prospective homebuyers.”

Earlier this week, Beatty send out a letter which 20 other Democratic members of Congress signed, urging Carson to reinstate the FHA mortgage insurance premium cut.

HousingWire reached out to HUD for comment, however, they declined to comment.

While it is unclear why the administration has yet to make a decision about the cut, HUD could be struggling to complete its examination due to the many vacancies in the department. HUD’s website shows nine positions remain unfilled.

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