FHA Fees Rising Again

 

FHA loans are some of the very best loans available for those who want to preserve cash, have credit issues or are lower income.  Problem is that FHA loans continue to cost more to obtain.  In the latest Mortgagee Letter issued from HUD, we see that fees are increasing, and cancellations of the Mortgage Insurance Premium (MIP) being extended.

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Here’s what you need to know to advise your clients accordingly:

  1.  Effective with all loans originated and case numbers issued on or after April 1, 2013, the monthly MIP premiums are increasing by 10 bps across the board, which ranges from 0.95% to 1.30% of the loan amount depending on loan program, loan amount  and loan-to-value
  2. Effective with all loans originated and case numbers issued on or after June 3, 2013, the automatic cancellation of the annual MIP premiums has been rescinded.  
  3. All FHA loans with a loan-to-value  less than or equal to 90%, will have annual MIP for the first 11 years of mortgage, or until the end of the mortgage term, which ever comes first.
  4. All FHA loans with an LTV greater than 90%, will have annual MIP for the life of the loan, or 30 years, whichever comes first.

Please contact your preferred Mortgage Advisor at Absolute Mortgage Banking for further guidance on FHA loans or to inquire about the literally hundreds of loan programs that AMB provides.

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