Maybe.

Help me if I'm wrong but the MIP, even though it's less, never goes away as it did previously. When the original principal amount reached 79% the MIP would disappear automatically or you could apply to have it removed when 80% of the original loan was met. You need to analyze your purchase looking ahead for 5, 10 or even 20 years.

This is always the case, Praful.

I doubt that this ever makes a difference.

yes it will most definately help... bottom line is still the bottom line

Yes I do, home ownership is a privilege and a way of life.  Most responsible people value owning a home.

I believe that more will now use the FHA loan, though not sure if more overall buyers will enter the market because of it.

Even if they do, the strict guidelines are still in place and many will not be able to qualify for the strict standards 

Praful, the lower MI will make FHA more attractive.    I think some first time home buyers will go for it.

Praful, that is possible and it depends on the market.  We were talking on Friday to an agent who just sold a "starter home" for $900,000, to a first time home buyer.  Given the $$$amount, you have to have the income to pay for it, and I don't think it would make a big difference in this case.

Most first time buyers have little appreciation of this news. They need to be educated by their real estate agent and their loan officer. The end result is that many will benefit from the lower MIP.

I'm not sure. There is a new conventional loan from Fannie and Freddie for a 3% down conventional loan which seems more promising right now.

But sure, lowering mortage insurance won't hurt anything!