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HVCC May Not Go Away; FHA Assumability is Valuable

Note that we have a few lenders at 4.125% today, but those lenders require Impound Accounts (taxes and insurance get paid every month with mortgage payment). Many lenders offer lower rates with Impounds, but we do not quote those rates b/c so many of our borrowers do not like this requirement. We are certainly not averse to using those lenders, however, if borrowers desire Impounds.

HVCC is slated to go away in November, but it appears that many major lenders may cling to their Appraisal Management Companies, as we feared. Some smaller lenders will allow “old fashioned” competent appraisals, however, and we will take full advantage of that.

FHA Loans are Assumable. No other loans are. We frequently point this out, as this feature could make FHA financing extremely valuable in the future if (when?) inflation hits and rates go to double digits. We cannot emphasize this enough. Below is a link to an article in which the benefits are explained more fully. But the long and short of it is that if you are selling your house and offering a 4.5% rate in a 10% rate environment, your house will be far more valuable.

Here’s the link: Assumability of FHAs: How Much Is It Worth?

Jay Voorhees
Founder/Broker | JVM Lending
(855) 855-4491 | DRE# 1197176, NMLS# 310167