|Example: Purchase Price $175,000 with 3.5% down payment at 4% mortgage rate on 30 year term|
|MIP duration||78% of original loan||Life of mortgage|
Wednesday, March 20, 2013
More Expensive Then Expected
The 3.5% down payment on FHA loans could be more expensive for buyers than expected. Beginning April 1, 2013, the mortgage insurance premium will go up by .1% to 1.35% which may not even be noticeable to most would-be homeowners. The staggering increase will occur on 6/3/2013 when FHA's policy on the duration of the required mortgage insurance will be increased for the life of the mortgage. It basically doubles the amount of total MIP if the loan is paid to term.