FHA mortgage insurance premiums change again.

7 09 2010

 

HUD has released their new mortgage insurance premiums, effective for all case numbers pulled after Oct 4th.  As HUD foreclosures have increased, HUD’s reserves have dropped.  So to put more “money in the pot” to continue insuring new FHA loans, HUD has changed their MI premiums. 

The upfront premium will actually be dropping from 2.25% to 1%.  The monthly premium, however, will almost double from .55% to .90 – .95%, depending on loan to value. 

Click HERE for the Mortgagee letter from HUD.

This change can have a huge impact on borrowers who need FHA financing with tight monthly budgets, as the monthly payment will increase drastically under the new premium guidelines.  If you have borrowers looking to buy with FHA financing, let’s work together to get them under contract and closed before the changes hurt our clients.    

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