I warned about this in previous updates. FHA is now officially raising mortgage insurance premiums. The good news is the new guidelines don’t go into effect until April 1st – so those looking to do a FHA loan should move quickly. Here are the new guidelines:
– Annually Mortgage Insurance Increasing by .1% on most loans
– Monthly Mortgage Insurance will now be for the life of the loan on most loans
– 15 Year Fixed Loans under 78% Loan to Value will now require Monthly Mortgage Insurance
FHA is also in conversations to raise the minimum down payment on purchase loans to 5% versus the current 3.5%.
All changes go into effect on FHA case loan numbers pulled on or after April 1st, 2013.
FHA has announced that they are increasing mortgage insurance premiums yet again. This is the continuation of a trend for FHA – FHA has raised mortgage insurance premiums for 3 years straight. Here are the changes coming:
– 10 bps increase on monthly mortgage insurance premiums. This will raise mortgage payments by $8.33 per month per $100,000 in loan amount.
– Monthly Mortgage Insurance will now be carried for the life of the loan. Currently, you can remove mortgage insurance premiums after 5 years and once you pay the loan down to 78% Loan to Value of the original appraisal.
These are big changes, especially the Monthly mortgage insurance for life. If you are looking to streamline your existing FHA loan or purchase a new home with a FHA loan, now is the time to do it before the mortgage insurance premiums go up and last for the life of the loan.
FHA RAISING MORTGAGE INSURANCE PREMIUMS IN 2013 – THEY WILL NOW LAST FOR THE LIFE OF THE LOAN.
FHA is increasing their mortgage insurance premiums significantly on case numbers taken out after April 9th,, 2012. If you are looking to do an FHA loan, your best bet is to start it soon or at least get your case number pulled before April 9th.
Below are the changes for new non FHA streamline loans with case numbers pulled after April 9th:
30 YEAR FIXED FHA LOAN – or loans terms over 15 years
95% LTV and below: 1.75% upfront MI 120 bps Annual MI
Over 95% LTV: 1.75% upfront MI 130 bps Annual MI
15 YEAR FIXED FHA LOAN – or loan terms less than 15 years
78-90% LTV: 1.75% upfront MI 35 bps Annual MI
Over 95% LTV: 1.75% upfront MI 60 bps Annual MI
These changes will increase the average FHA loan over $8 per $100,000, and the upfront fees $500 per $100,000.
FHA STREAMLINE MORTGAGE INSURANCE CHANGES:
FHA has also announced a dramatic lowering of the mortgage insurance premiums for FHA STREAMLINE LOANS. An FHA streamline loan is a current FHA customer refinancing their loan to another FHA loan with the same term. Because FHA raised their Mortgage insurance premiums in April of 2010, many customers could not streamline their loans as there was not enough benefit.
These new Mortgage insurance premiums will only be in effect for borrowers who had their FHA case number pulled before June 1st of 2009.
ALL FHA STREAMLINES LOANS – original case number pulled before June of 2009
UPFRONT MI .01%
ANNUAL MI: 55 bps
This is a huge change and will dramatically help customers in existing FHA loans lower their rate and payment.
These changes will better the existing FHA MI factors by over $45 per $100,000, and upfront fees by $990 per $100,000.
FHA MORTGAGE INSURANCE CHANGES FOR LOANS OVER $625,500.
Lastly, FHA is changing its mortgage insurance premiums for FHA jumbo loans over $625,500. These changes will take effect for case numbers assigned on or after June 11th, 2012.
30 YEAR FIXED FHA LOANS OVER $625,500 – or loans terms over 15 years
95% LTV and below: 1.75% upfront MI 145 bps Annual MI
Over 95% LTV: 1.75% upfront MI 150 bps Annual MI
15 YEAR FIXED FHA LOANS OVER $625,500 – or loan terms less than 15 years
78-90% LTV: 1.75% upfront MI 60 bps Annual MI
Over 95% LTV: 1.75% upfront MI 85 bps Annual MI
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