The Federal Housing Administration or FHA as they are commonly known will delver another blow to potential home buyers on April 18 2011.
Per Mortgagee Letter 11-10 issued on Feb. 14th 2011: The Annual Mortgage Insurance Premiums are increasing on loans that do not have a valid FHA case number prior to the date. FHA will also cancel case numbers issued prior to April 18th 2011 that have not met certain criteria in the last 6 months and this includes new construction.
How bad is the increase? 27.7% in your monthly MIP
- How much will it cost you?
If you are taking out an FHA loan for $200,000 your annual MIP cost will will increase $500.00 per year or $41.67 per month!!
The new increase doesn’t take effect until April 18th 2011. If you are currently under contract make sure the lender has a valid FHA case number and if you are looking you still have time to get under contract and avoid the increase. Remember you do not have to close on the home you just need a valid FHA case number prior to April 18th 2011.
PaFhaMortgage.com
By Bill Frantz
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