Hear ye, Hear ye! All Buyers intending to utilize an FHA Loan for purchasing a home, it is best to get an FHA case number assigned as quick as possible. All FHA case numbers assigned on or after 6/3/2013 the FHA will collect annual Mortgage Insurance Premiums(MIP) for the life of the loan. What does this mean?
Currently, FHA borrowers would MIP until they could prove they had at least 20% equity in their property. Once they had an appraisal showing the 20% equity, the borrower could petition the lender to remove this additional monthly charge. Now, the borrower will be paying the MIP for the life of the loan, which in most cases, is 30 years.
In addition, MIP factors are changing so not only will FHA borrowers be paying MIP for a longer time, but also they will be paying higher amounts. So, if you are on the fence about purchasing and were planning on using an FHA loan because of its low 3.5% down payment, you better hurry and get under contract soon.
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