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FHA set to Increase Mortgage Insurance Premiums

posted by Stephen Katz @ 5:01 PM
Wednesday, February 23, 2011

Starting April 18, 2011, the  Federal Housing Administration (FHA) mortgage insurance premium will be increased on all 30 year and 15 year loans. The amount of the increase is a quarter of a percentage point (.25) which is typically financed into the loan.  This will in turn be an average increase to new borrowers of about $32 per month. 

FHA says the increase is needed to maintain the stability of the Mutual Mortgage Insurance Fund (MMIF).  It is estimated that this increase will generate around $3 billion annually to the MMIF.  The additional expense may have borrowers looking to obtain mortgages in the private sector.  FHA loans will cost a borrower almost twice as much for mortgage insurance on a 30 year loan as compared to a non-FHA mortgage.

If you are looking to buy a home with an FHA mortgage, now is the time to apply before the increase.  There are plenty of great deals on homes in the market today and with rates so low, now is the perfect time to jump in. 

Stephen Katz

(770) 309-0939 (direct) or (866) 742-8400 -- For the past 18 years, Stephen Katz has built a successful business almost entirely on referrals. As your mortgage consultant throughout the home loan process, Stephen will explain the pros and cons of all available mortgage programs and help you choose the financing option that is best suited to your needs. Throughout the loan process, he will keep you informed and will respond quickly to your requests with answers and solutions. Consistently a top producer, Stephen is a Mortgage Bankers Association "Diamond" Award winner, a Georgia Mortgage "Top Gun" and has closed almost half a billion dollars in loans. Put his knowledge and experience to work for you!

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