Recently, the Federal Housing Administration announced that they are halting the policy of allowing lenders to collect interest to the end of the month when the homeowner’s FHA mortgage is paid off. Beginning in January of 2015, lenders will be able to collect interest until the day the loan is paid off.
However, it should be noted that for the millions of homeowners who currently have home loans insured through FHA, there is no change in policy. The new policy will affect only those who obtain new FHA loans in January of 2015.
What Does This Mean For Present Homeowners?
It is important to time refinances and sales of houses to allow time to get the payoff to the present lender before the end of the month. Otherwise, the homeowner could owe a full month of extra interest.
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