The Federal Housing Administration announced several changes to FHA insured loans this week.
1) The upfront mortgage insurance premium will increase from 1.75% to 2.25%.
For example: On a a $200,000 mortgage, a 1.75% mortgage insurance premium added $3,500 to the FHA loan, bringing the total loan amount to $203,500 that a borrower was required to qualify for. With the increased premium at 2.25%, the premium would increase to $4,500 and the borrow would need to qualify for a $204,500 loan. This amounts to an approximate difference of $5.37 per month at an interest rate of 5.00%.
2) The maximum amount of seller assistance will drop to 3% of the value of the