FHA Home Loan Payments Will Increase
Inland Empire home buyers who will be using FHA financing just got hit with another blow from HUD. With yesterday’s announcement; beginning April 18, 2011, the Annual Mortgage Insurance Premiums charged by FHA will increase 25 basis points. Just last year on April 4, 2010, HUD increased the monthly MIP from .55 to .90 for all loans where the LTV is greater than 95%.
“After careful consideration and analysis, we determined it was necessary to increase the annual mortgage insurance premium at this time in order to bolster the FHA’s capital reserves and help private capital return to the housing market,” said FHA Commissioner David H. Stevens. “This quarter point increase in the annual MIP is a responsible step towards meeting the Congressionally mandated two percent reserve threshold, while allowing FHA to remain the most cost effective mortgage insurance option for borrowers with lower incomes and lower down payments.”
After the transition, a borrower holding a 30-year, fixed FHA-insured loan valued at $163,000 will be paying $151 per month in premiums, compare to $118 under the current rates.
Whether this recent increase will have yet another negative impact on home buyers using FHA financing and the overall housing recovery in the San Bernardino/Riverside area remains to be seen. If you or someone you know who is looking to purchase a home in the very near future, it may be in your best interest to look at speeding up that process.
To view the actual mortgagee letter issued by HUD, please click here. If you have any questions, please contact me anytime.
February 15, 2011 by Mark Estermyer · Leave a Comment
Mark Estermyer is a Senior Loan Officer with over 14 years experience in the mortgage lending industry. Mark's team works for RPM Mortgage, a private mortgage banker. At RPM Mortgage, we offer FHA, VA, all conforming and non-conforming loans. However our specialty are the Jumbo and High-Balance Conforming Loans. Mark can be reached at (909) 863-0000 or by email marke@pchfund.com.
