It’s Official: FHA Mortgage Insurance to be reduced

Today HUD issued Mortgagee Letter 2015-01 officially reducing FHA mortgage insurance effective on case numbers issued on or after January 26, 2015. HUD is also allowing existing case numbers (with the current higher mortgage insurance) to be cancelled as long as they were ordered within 30 days from today.

[Read more…]

Mortgage Insurance Deductible through 2014

You may have heard that last week, Congress passed and President Obama signed the 2014 Tax Increase Prevention Act. It has some good news for home owners who currently pay various forms of mortgage insurance. If you pay mortgage insurance, including private mortgage insurance (pmi), or VA, FHA or USDA forms of mortgage insurance during 2014,  you may be able to deduct that on your 2014 income taxes.

Before you get too excited, this act does not extend the mortgage insurance deduction past 2014.

So if you are paying any form of mortgage insurance, especially if it’s private mortgage insurance or FHA mortgage insurance, it still makes sense to see if you can eliminate or reduce your payment with a refinance as you will not be able to deduct your mortgage insurance during 2015 (as things currently stand).

If I can help you with your refi or home purchase on property located anywhere in Washington state, please contact me!


Mortgage Insurance loses tax deduction benefit in 2014

mortgageporterraiseOver the past few years, home owners have enjoyed deducting private mortgage insurance (pmi) premiums from their income tax. This is also true for government forms of mortgage insurance (aka funding fee or guarantee fee) with FHA, VA and USDA mortgage loans. This benefit is coming to an end effective on 2014 tax returns.

[Read more…]

Mortgage Insurance is Tax Deductible for 2013

Home owners who acquired their home after 2006 and who have mortgage insurance may be able to treat the mortgage insurance premiums as they would their mortgage interest deduction when they file their 2013 income taxes. This is per IRS Publication 936.

Here are some basic requirements:

[Read more…]

One month left before FHA mortgage insurance is permanent…SO WHAT??

Borrowers not wanting to have FHA mortgage insurance as part of their mortgage payment for the life of the loan have about thirty days to take action. This shouldn’t be a reason to panic. 🙂

Effective FHA case numbers issued June 3, 2013 and later, FHA mortgage insurance will become a permanent part of the FHA mortgage payment.

Why do I say “SO WHAT?”

[Read more…]

Get Ready for Round 2 of Changes to FHA Mortgages

mortgageporter-round-twoEffective this week, FHA annual mortgage insurance premiums were once again increased on loans with case numbers issued April 1, 2013 or later by 10 to 15 basis points. This is just the first round of changes that were issued with HUD Mortgage Letter 2013-04.

[Read more…]

No Fooling! Time’s Running Out on Reduced FHA Mortgage Insurance Premiums

There are just a few days left before FHA mortgages will have another increase to annual mortgage insurance premiums. Effective with case numbers issued April 1, 2013 and later, FHA annual mortgage insurance premiums will adjust an additional 10 bps to 15 bps.

[Read more…]

Five weeks remaining before FHA mortgage insurance premiums increase

HUD has scheduled another increase to FHA annual mortgage insurance premiums effective with new case numbers obtained April 1, 2013 and later. FHA’a annual mortgage insurance premiums are paid monthly and are set to rise by 10 basis points.

For example, a base loan amount of $400,000 with a loan to value of 95% or lower, currently has a monthly mortgage insurance premium of $396.65 based on a rate of 1.20%. After the new mortgage insurance rates go into effect, this monthly premium will be $429.71 – an increase of $33.06 per month.

NOTE: Home owners who currently have FHA insured mortgages for their primary or investment properties and who had those mortgages guaranteed by FHA prior to June 1, 2009 will still qualify for reduced mortgage insurance premiums with FHA streamlined refinances. If you’re not one of these lucky home owners, you may want to take action now!

In addition, with new FHA loans as of June 3, 2013, FHA mortgage insurance will remain on the life of the loan. The only way to terminate it is to refinance out of an FHA loan or pay the loan off. Currently, FHA annual mortgage insurance is set to drop off the loan after it reaches a 78% loan to value and a minimum of 60 mortgage payments have been made. However with a minimum down payment scenario, it often takes closer to nine years before the loan to value reaches 78%. I would bet that many Washington home owners either refinance or sell their homes before their mortgage insurance drops off. Regardless, if you want to avoid having to pay FHA mortgage insurance for the life of that FHA insured mortgage, you’ll need to have your FHA case number prior to June 3, 2013.

What can you do?

If you want to avoid having a higher mortgage payment and you’re considering an FHA loan for your refinance or home purchase, you have a short window of opportunity to secure your lower payment now. An FHA Case number is not your application date. It is actually obtained shortly after you have a bona fide transaction and application. As we near the April 1 date, if you have a new FHA mortgage in process, you will want to confirm with your mortgage professional that your FHA case number has been secured. (They can provide you your FHA case number as proof).

I have been helping people with FHA insured mortgages since April 2000 at Mortgage Master Service Corporation. If you would like me to provide you with a rate quote for your home located anywhere in Washington State, click here.