A week from today, on June 11, 2012, HUD has more changes scheduled for FHA mortgage insurance premiums. I've been sharing this news with you here on my blog.
Let's start with the higher premiums. If you are considering an FHA high balance (also known as an FHA jumbo) mortgage, if possible, you want to obtain your FHA case number as soon as possible. Starting next week, effective on case numbers obtained on or after June 11, 2012, FHA annual mortgage insurance premiums for high balance loans will go up an additional 0.25%. FHA annual mortgage insurance is paid monthly.
In the greater Seattle area, this will impact FHA loans from $417,001 to $567,500.
If you are buying a home with utilizing an FHA insured mortgage – make sure you get your case number pronto. This also implies to you if you're doing a rate-term FHA refinance (not an FHA streamline) or an FHA streamline refinance that was endorsed after June 1, 2009.
This is a good segue to the reduced premiums that take effect next week…
HUD has dramatically reduced FHA mortgage insurance premiums on loans that were endorsed prior to June 1, 2009. An FHA mortgage is "endorsed" after closing – sometimes many weeks after. It's possible your FHA mortgage closed in May 2009 and was not endorsed until after June 1, 2009, in which case, your loan would not qualify for the reduced mortgage insurance premiums.
If your FHA mortgage was endorsed prior to June 1, 2009, your eligible for greatly reduced MI rates. HUD has reduced the upfront mortgage insurance premium to 0.01% and the annual mortgage insurance premium to 0.55%. It's a significant savings, especially when you factor in today's extremely low mortgage rates.
The reduced FHA mortgage insurance premiums are available for FHA streamlined refinances with case numbers obtained on or after June 11, 2012. Guess what? You do not need to wait until June 11, 2012 to start your FHA streamlined refinance. We are accepting mortgage applications now for FHA streamlined refinances as long as your home is located in Washington state. FHA streamlined refinances do not require an appraisal so it's okay if your home has lost value.
I have been originating FHA loans since April 2000 at Mortgage Master Service Corporation. If your home is located in Washington State, I'm happy to help you with your mortgage. Click here if you would like me to provide you with a mortgage rate quote for your Washington home.