Wednesday, April 13, 2011

FHA Mortgage Insurance Rates Increasing

On April 15th FHA mortgage rates are increasing once again to 1.15% annually and will continue to be 1% upfront.  If you are currently in contract you have just a day or two to order an FHA case number on a property to lock in the lower .90% MI.

Just to put it in perspective the current MI is 72.37 per $100,000 sales price with 3.5% down; After the change it will increase to $92.48.  So plan on paying an additional $20 per $100,000.

Quick Tip:
FHA rates are sitting around 5% and if you want a fast way to get a total monthly payment simply multiply 7.65% per thousand you want to borrow.  Example: 200(200K) x 7.65 = $1,530 per month

Conventionally at 20% down the math is the same but the multiplier is different since MI is not needed.  Use 5.85% as the multiplier.  200(200K) x 5.85 = $1,170 per month

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