FHA Mortgages - Updates to Mortgage Insurance Premiums

There's no question that FHA loans can offer significant benefits to borrowers, such as competitive low rates. Recently there have been several changes to the loans, but most of them only effective certain borrowers.

However, one change will apply to all  FHA loan applicants - the increase in mortgage insurance premiums effective April 9th, 2012.

The up front Mortgage Insurance Premium (MIP) is being increased from 1% to 1.75%. Borrowers can still finance this fee into the loan, so there is no immediate out of pocket expense, but it will increase the loan amount and the monthly payment.

Also, the monthly Mortgage Insurance Premium (MIP) is being increased from 1.15% to 1.25% for the average 30 year loan. This amount will also increase the monthly payment.

This will make FHA loans slightly more expensive than they have been int he past, but they still offer a low down payment at very competitive rates.

For more information about the changes, feel free to contact David Poole, mortgage loan originator, who provided me with this information. You can reach David at 954-254-7468 or visit his website at www.DavidPooleOnline.com 

For a complete nationwide list of lenders who can assist with FHA loans, visit http://www.hud.gov/ll/code/llslcrit.cfm