If you’re in the market to buy a house in the next month and you’re planning on using a FHA mortgage to finance the cost, you MUST read this! Starting April 18th, FHA will increase their Annual Mortgage Insurance Premiums (MIP). “Mortgage insurance is a policy that protects lenders against losses that result from defaults on home mortgages (i.e. foreclosures, short sales, etc). FHA requirements include mortgage insurance primarily for borrowers making a down payment of less than 20 percent. May of you most likely current pay MIP as part of your current mortgage payment.”
For anyone applying for a loan after April 18th, it is increasing from .9% per year to 1.15% per year. What does that mean for you?
For every $10,000 you want to borrow, you will pay approximately $2.08 more per month. Now this doesn’t seem like much, but when you break it down, it really is.
- $100,000 loan amount = an extra $20.80/month
- $150,000 loan amount = an extra $31.20/month
- $200,000 loan amount = an extra $41.60/month
For those of you not in the market right now to buy a house, this doesn’t mean much, because chances are, if you are not in the market right now, then not much will change in the next two weeks. BUT for those of you who have been casually looking, trying to make a decision…GET MOVING or as I like to say “Eat That Frog” (reference to one of my favorite books on procrastination)…if you can find a house in the next two weeks, then you can save a LOT of money over the course of your loan.
If you have any questions about this or anything related to Real Estate PLEASE give us a call today!
More information about FHA MIP: http://www.fhanewsblog.com/2011/03/fha-mortgage-insurance-annual-premium-increase/
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