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Utah Mortgage Consumers are paying the price

Unfortunately Mortgage consumers are again, having to pay the price of the recent economic crisis.  As part of ongoing efforts to strengthen the FHA capital reserves, and to help push private money back into mortgages, the FHA came out with a new premium structure for FHA-insured mortgage loans increasing its annual mortgage insurance premium (MIP) by a quarter of a percentage point (.25) on all 30- and 15-year loans starting in mid-April. (The upfront MIP will remain unchanged at 1.0 percent.) The increase adds $30 to the average borrower's payment and in total is estimated to add $3 billion annually to the FHA's Mutual Mortgage Insurance Fund. It is the second increase since October.

Also HUD has just revised their "Net Tangible Benefit" to consumers when trying to do a streamline refinance.  They will now require a total of a 5% reduction of principle, interest, and the annual mortgage insurance premium or refinancing from an Arm to a fixed rate mortgage.  Keep in mind the new streamline refinance will require the annual premium listed above.

Will home prices fall or rise in 2011?

Here is a great article that talks about the overall picture on what drives a housing market.

What drives a housing market?

"According to the local MLS the median sales price of a home in Salt Lake County peaked in the third quarter of 2007 at $256,000.  Prices then drifted down over the next three years to $230,000 in second quarter 2010. However, the rate of price decline has narrowed substantially in the past two quarters. 
Prices will likely be unchanged through the first two quarters of 2011 with perhaps slight gains in the third and fourth quarters.  Continued price pressure from foreclosures and short sales will prevent upward movement in prices in 2011.  In the end, any meaningful rise in home prices depends on a pick-up in housing demand, which will require an improvement in the job market, higher levels of household growth and fewer foreclosures.  These conditions will gradually be satisfied over the next few years but in the meantime housing prices are likely to remain stable, with more downside risk than upside potential. (2.1.11) "