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HUD announced they have increased the annual FHA mortgage insurance premium. FHA costs are rising from 0.55 % of the FHA loan amount to 0.90% (for loan to values higher than 95%) or 0.85% (for LTVs lower than 95 %). This insurance premium hike will go into effect, October 4th, 2010. In an effort to save face, FHA will be lowering their upfront mortgage insurance to compensate homeowners for their rising monthly payments. This is good news for new homebuyers because the
FHA lenders are offering record low rates and loan fees are being reduced to 1% of the loan amount from 2.25%. The
FHA requirements are becoming more demanding for both lenders and consumers, but HUD believes that tighter guidelines can salvage
FHA lending now and for the near future. Read the original article online >
FHA Mortgage Costs Rising
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