Orange, California (PRWEB) August 07, 2013
The Federal Government has increased FHA mortgage insurance premiums significantly in the past year. The most serious and heavy impact comes from the recent June implementation of a permanent monthly insurance premium. The increase of mortgage insurance premiums as well as the higher interest rates, has left banks scrambling to find a way to keep mortgages affordable.
Broadview Mortgage, a California based direct lender, has begun to offer private mortgage insurance (PMI) with conventional loans. These are seen as the key alternative to FHA loans and paying FHA mortgage insurance.
"Homebuyers who don't have a 20% down payment can still get a great home using private mortgage insurance. In fact, it's a better deal than anything FHA has to offer right now." says Scott Schang, a branch manager for Broadview Mortgage.
Private mortgage insurance rates can be as much as 50% less than FHA rates. These savings, according to Schang, can go towards affording a larger purchase price.
"Bottom line is that it's a competitive market. The highest and best offer will be the one that is accepted. As it is, FHA loans are not favored by sellers and the lower offers from FHA buyers compared to conventional are not even being looked at." says Schang.