FHA MORTGAGE INSURANCE CHANGES

March 7, 2012 By T.C. Strait / Loan Officer

As mentioned in previous articles FHA MORTGAGE INSURANCE INCREASING and FHA POISED TO LOWER MIP FOR STREAMLINES FHA has decided to officially revised their mortgage insurance requirements on FHA streamline refinances as well as normal Purchase and Refinance FHA mortgages. Below are the new FHA mortgage insurance figures and their effective dates:

FHA Streamline Refinances
Effective with FHA Case Numbers assigned on or after JUNE 11, 2012
For any FHA loans that were endorsed on or before MAY 31, 2009 (not sure how to check this yet)

Monthly Mortgage Insurance (MIP) will be 0.55% for all loan amounts
Up Front Mortgage Insurance Premium (UFMIP) will be reduced to 0.01% (currently 1%)

This will help those borrowers that have tried to do an FHA Streamline refinance from October 2010 (when the mortgage insurance increased) through now.

FHA Purchase and Refinance (Non-Streamline) Changes:

MONTHLY MORTGAGE INSURANCE (MIP) INCREASES
For FHA Case Numbers assigned on or after APRIL 9, 2012

Terms GREATER than 15 years
Less than or Equal to 905% – MIP will increase to 1.20% (currently 1.10%)
Greater than 95% – MIP will increase to 1.25% (currently 1.15%)

Terms LESS THAN OR EQUAL to 15 years
Less than 78% – NO MIP (same as currently)
78% to 90% – MIP increases to 0.35% (currently 0.25%)
Greater than 90% – MIP increases to 0.60% (currently 0.50%)

UP FRONT MORTGAGE INSURANCE PREMIUM (UFMIP) INCREASES
Effective for FHA Case Numbers assigned on or after APRIL 9, 2012

Increase to 1.75% (currently 1%)

Obviously this will increase the cost to borrowers who obtain an FHA loan after April 9th. Keep in mind that your lender/loan officer has to order your FHA Case Number and get it successfully assigned prior to April 9th. The process of ordering an FHA Case Number can take a few days.

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