FHA Upfront Mortgage Insurance

The cost of obtaining an FHA loan just got higher... FHA announced on February 27th that the FHA upfront mortgage insurance rate will be increased from 1% to 1.75% for new loans as of April 1st, 2012. In addition to the increased upfront rate, the monthly mortgage insurance fee will also go up 10%. While it seems natural to complain about the increase, FHA advises that the increase to the upfront premium will cost new borrowers an average of approximately $5/month. This isn't too much to ask considering that FHA has paid $37 billion in claims related to defaulted mortgages since 2008. How can you get around this increase? Pursue an FHA loan and have a case number assigned prior to March 30th, 2012! Call us if we can help you find the perfect property or if you would like lender recommendations!