It was recently released that the mortgage insurance premiums for FHA mortgages is reducing by half a percent. This will assist home buyers currently in the market. The following is some important information on PA lower FHA mortgage insurance premiums.
Beginning January 26, 2015
PA lower FHA mortgage insurance premiums are effective on January 26, 2015. All FHA case numbers issued on or after that date will benefit from the reduced rates. Case numbers are usually created when you apply for an FHA loan. For case numbers already created, you might be able to cancel and generate a new one. There is a particular procedure that must be followed by your lender to accomplish this. Unfortunately, this is not available to closed mortgages. Refinancing would be needed.
PA Lower FHA Mortgage Insurance Premiums
PA lower FHA mortgage insurance premiums are 0.5% below past mortgage insurance premiums. There are actually various mortgage insurance premiums based on the down payment amount. For mortgages with five percent down or greater, the monthly mortgage insurance was 1.3% and is now lowered to 0.8%. For mortgages with less than 5% down, the monthly mortgage insurance was 1.35% and is now decreased to 0.85%.
Impact of the Lower Mortgage Insurance Premiums
Recurring mortgage insurance is determined by multiplying mortgage insurance and loan value, and dividing by 12. For a typical borrower with a 3.5% down payment, the mortgage insurance on a $200,000 loan adjusts from $225 to $141.67 per month, saving $83.33. On a larger home loan of $400,000, it lowers from $450 to $183.33 per month. With the lower mortgage insurance premiums, that same home buyer who qualifies for $400,000 may be able to get a higher loanof $420,000. This rate change not only saves buyers money but may also help buyers to get into a higher-priced property (if desired).
Help with FHA Mortgages in PA
PA lower FHA mortgage insurance premiums is simply one of many changes that affect home ownership. Your loan specialist ally to keep you informed of important changes and help you with the mortgage process. Contact Diana Escobar-Wachter at Access Abstract Corporation (610-461-2910, wachterd@accessabstract.com) to be referred to a local loan officer.
