Lenders must be FHA approved to do FHA loans
If you are currently in the market to buy a home and plan on using FHA for your mortgage financing, keep in mind that the annual mortgage insurance will be higher for loans assigned case numbers starting April 18, 2011.
Local mortgage guy Todd Marumoto of Intercoastal Mortgage in Fairfax, VA sent me an e-mail update about this increase along with some examples of how it will impact the monthly payments of FHA borrowers. The trade off is simple to understand because FHA loans provides low down payment loans to qualified borrowers.
Todd said:
Please be aware FHA is increasing the annual mortgage insurance premium by .25% effective with FHA case numbers assigned on or after 4/18/11. The upfront premium will remain the same.
Mortgage Insurance Premiums.
Annual Premium Loans Terms > 15-yearsLoan-to-Value
Current and Starting 4/18/11
<=95.00% currently .85% increasing to 1.10%
>95.00% currently .90% increasing to 1.15%
How will this impact your monthly mortgage payment?
Todd’s example:
Sales Price: $300,000 $300,000
Max Loan (96.50%) $289,500 $289,500 (before upfront mortgage insurance)
Annual Premium .90% 1.15%
FHA Annual MIP $217.13/mo $277.44/mo
Change in payment n/a $60.31/mo
Contact your local mortgage professional today to get specifics on what it takes to get assigned a FHA case number before the deadline.
