FHA moves to cut premiums for first-time homebuyers

South Florida housing experts are welcoming a move from the Federal Housing Administration this week that will save the average first-time homebuyer an estimated $900 a year.

The FHA is reducing mortgage premiums by half a percentage point, from 1.35 percent to .85 percent, according to published reports. The agency plays an important role for first-time homebuyers because it accepts lower FICO credit scores than other lenders and it issues mortgages with with very little down payment.

Regardless, challenges remain for first-time homebuyers, especially in South Florida’s unique market, the Miami Herald reported.

Arden Shank, president of Neighborhood Housing Services of South Florida, a nonprofit agency that works with residents to help them buy and keep their homes, supported the FHA’s move but said that more needs to be done.

“We view it [the FHA premium reduction] as an important first step — but not the be all and end all,” Shank said to the Miami Herald. “Clearly it will make a difference. We’re looking for more. We’re hoping for more.’’ [Miami Herald] — Katherine Kallergis