Archive for FHA Mortgage
FHA Mortgage Insurance Changes Coming
Posted by: | CommentsAugust 12, 2010
FHA News - FHA recently announced that they are revamping the Mortgage insurance structure for FHA loans. Originally to start in Sept, 2010 it is now set to change on Oct 4, 2010. The Up Front Mortgage Insurance Premium (was 2.25%) will be reduced to 1% BUT the monthly premium (was .55% annually) is now increasing to .85% and .90% (depending on certain qualifying factors). Congress recently authorized the FHA to increase fees to a max of 1.55% for the monthly factor. FHA has elected to use lesser for now. Bottom line, buyers payment will go up.
The following is taken from the FHA Press Release…
“Last week, FHA Commissioner David H. Stevens announced plans for implementing FHA’s new mortgage insurance premium structure. As we work to publish a Mortgagee Letter, it is our intention to announce that based on industry feedback and our desire to have this change implemented successfully in the marketplace, FHA will make the premium fee changes on all new case numbers effective October 4, 2010. Over this past week, the industry responded with support of the new fee structure, but voiced strong concern about having system changes ready in time to meet the original September 7, 2010 deadline. Since these system changes impact regulatory disclosures, lenders expressed they must have the additional time to implement and test systems. FHA took this feedback seriously and has accommodated the need for additional time.”
FHA Mortgage Changes
Posted by: | CommentsMarch 24,2010
FHA Mortgage costs are changing. Effective April 5, 2010 the current upfront mortgage insurance premium that FHA charges for new mortgages will increase from 1.75% to 2.25% of the base loan amount for the FHA loan. FHA requires a 3.5% down payment for most FHA insured purchase mortgages. If your purchase price is $100,000.00 and the down payment requirement is 3.5% then your base loan amount will be $96,500.00. FHA allows the upfront MIP to be added to the base loan amount. As a result your loan amount increases from $96,500.00 to $98,671 (base loan amount + 2.25%). You now have a LTV (loan to value) of 98.67% of the purchase price; less than 2% equity in the property.
