Garrison Lamothe Advises on Federal Housing Administration Fiscal Solvency Act

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Changes with mortgage insurance may come about with the Federal Housing Administration Fiscal Solvency Act, and Garrison LaMothe wants people to understand how to prepare.

The FHA may be raising its mortgage insurance premiums yet again. The Federal Housing Administration Fiscal Solvency Act of 2012 has overwhelmingly passed the House and will make its way to the Senate. Garrison LaMothe, a mortgage broker serving Plano and its surrounding areas, has some advice for this new development in mortgage insurance.

Among other powers, the bill grants the FHA authority to raises its mortgage insurance premiums to as high as 2.05% annually, that’s nearly twice the 1.20% rate most FHA-insured homeowners pay today.

The FHA was, and remains, the only self-funded lending / insuring entity as a boon to taxpayers. Founded in 1934, FHA made homeownership more prevalent and widespread. It requires $2 of reserves for every $100 insured. They currently have just $.24 for every $100 insured, an all-time low. The increase in premiums would be to offset the heavy losses it took on defaults between 2007-2011.

The FHA may put some of the onus back on lenders by making them repay all losses caused by fraud, and prohibiting high Neighborhood Watch rated lenders from originating FHA loans. The effects to the economy could be severe. FHA is still the least restrictive loan program available but with increasing premiums, the loans themselves might become more expensive and potentially harder to obtain as these higher premiums are being discussed in conjunction with the traditional 3.5% down payment – a standard that could increase as an offset to the higher premiums.

Garrison LaMothe encourages people to lock their FHA loans in today, and if home-seekers know they will need FHA financing, it is critical to move fast. For advice or questions about mortgages and financing a home, please visit:

About the company:

Garrison LaMothe has been a mortgage professional for over 18 years, the last 7 of which has been spent as the owner/broker of Affirm Home Loans, LLc. A Plano based mortgage brokerage, LaMothe works directly with many local realtors and builders. He takes pride in those relationships and treats them with the diligence and care they deserve. LaMothe believes in an old-school approach. He likes to meet customers face-to-face. He believes that referrals are worth more than anything, and a testimonial is the best pay one can earn. He believes that returning phone calls, taking extra time to answer questions, and coaching clients about the process, are not extra steps but the key ingredients to making the customer's experience a great one. Financing a home can be scary and it's a huge decision. He wants his clients to feel like they won, when they allow him to arrange their loan, and that he will always be the first call they make, or their family and friends make, when thinking about financing a home. With an FHA Loan, VA Loan, or conventional home loan from Garrison LaMothe at Affirm Home Loans, homebuyers can get the home of their dreams.

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