Received an email from a lender friend of mine notifying me of new FHA loan requirements coming next month. Thought I’d pass along the info for those who may be interested…
FHA made an announcement last week about the future changes for all new FHA loans originated after Oct. 4, 2010.
- Upfront mortgage insurance premium will now be 1% (reduced from 2.25%). This premium is generally financed into the loan amount.
- Monthly mortgage insurance premium monthly factor will be increased from .55 to .90.
Here is how this will affect our buyers:
CURRENT FHA guidelines:
FHA GROSS loan amount with 2.25% FHA premium= $204,500
Payment at 5.0% 30 year fixed (P&I plus mortgage insurance) = $1189.47
NEW Loan Scenario after Oct. 4th
FHA GROSS loan amount with 1.0% FHA premium= $202,000
Payment at 5.0% 30 year fixed (P&I plus mortgage insurance) = $1234.38
That’s a $45/month increase! (And a relatively small loan amount.)