American Pacific Mortgage

American Pacific Mortgage

Tuesday, March 7, 2023



HUD has finally reduced the monthly Mortgage Insurance (MI) premiums for FHA loans. We’ve been anxiously awaiting this correction since they had amassed a rather large overage of funds collected for this insurance, which basically protects the lender from losses on high loan-to-value loans.

This is great news for first time homebuyers with low down payments.  The drop in monthly MI of 35 basis points presents a big savings in the monthly payment, particularly for those with 3.5% to 5% down, on purchases up to $1.1 million.  Savings is in the range of over $3000 annually.

VA has reduced their upfront Funding Fee, which is a fee charged by the VA for all VA loans.  This fee is paid directly to the VA and is typically added to the loan balance so it is financed over time as part of the loan payment.  This reduction makes it more attractive for repeat uses of VA loans, which offer lower interest rates and higher loan-to-values, without any Mortgage Insurance. 


Our inventory of homes for sale is shrinking again locally.  This means that sales volume has dropped quite a bit.  Many homeowners who might like to sell are postponing a move, as they don’t want to lose that low interest rate loan they currently have.

But it also means that home prices are just not going to drop much at all, at least locally.  Demand is currently about equal to or exceeding supply.  We aren’t seeing multiple offers on properties, but we also aren’t seeing big price drops.

We still see this as a great opportunity for those homebuyers with the stomach for higher rates, as they have little competition.  And those buyers who move in now will have the opportunity to drop their rates and refinance sometime later in the year, or early next year, when we anticipate rates to drop.


After quite a long hiatus, we decided to adopt two cats (siblings) last July.  It has been an adjustment but they have settled in and we are enjoying their company.  The only thing we forgot is now we have to have cat sitters while we are out of town!  Isabel and Theo are here:

As always please reach out with questions on these programs.