FHA Upfront Mortgage Insurance Premium Increase April 5th, 2010
March 8, 2010 by Victoria Stankard · Leave a Comment
It has never been a better time to buy a home with so many exceptional values on the market, government tax credits and historically low interest rates. However, there are some changes headed our way that will have an affect on these favorable conditions.
Top heavy home inventory is shrinking more and more each day as buyers take advantage of low home prices. The First-time Homebuyer Credit is also set to expire on April 30th 2010. Last, but not least, for those looking to buy their first home with an FHA backed loan, premiums on FHA upfront mortgage insurance will soon be going up.
According to Mortgage letter 2010-2 issued by the U.S. Department of Housing and Urban Development on January 21, 2010, there 
will be an increase in upfront premiums for FHA mortgage insurance for case numbers assigned on or after April 5th, 2010. The Federal Housing Authority is the only government agency that runs on its own self-generated income and that costs taxpayers nothing. The program is funded by insuring home loans and charging borrowers who qualify for an FHA loan, upfront mortgage insurance (MIP).
FHA loans are great for first-time buyers because they only require 3.5% of the price of the home as a down payment instead of the standard 20%, which is often hard to come up with. FHA mortgage insurance provides lenders with protection in case a homeowner defaults on their loan and guarantees they will pay a claim to the lender in the event of a default. Loans must meet certain requirements established by FHA in order to qualify for insurance.
As of April 5th, FHA insured loans for home purchases and non-streamline refinances will increase from 1.75% of the base loan amount to 2.25. An increase of .5% may not seem like a lot, but during these tough times, every cent counts! A refinance of an FHA underlying mortgage will increase from 1.5% to 2.25%.
Charlotte NC Real Estate Homes For Sale
If you are considering purchasing a home in Charlotte NC, now’s the time to get the ball rolling and save money. The FHA upfront mortgage insurance premium increase goes into effect 25 days before the “in contract” deadline for the First-time Homebuyer Credit hits.
Leigh Brown is the leading real estate broker in the Charlotte metro area. Over the years, Leigh has helped many first- time home buyers find great deals on Charlotte NC real estate homes for sale. She will walk you through the home buying process every step of the way!
You can reach Leigh by filling out her online contact form or give her a call at (704) 688-5005, or (866) 440-7136 toll free.
Victoria Stankard is a freelance journalist, SEO copywriter and co-owner of Get Found Now, an online marketing and search engine optimization company. She and her husband, Michael Stankard, live in Tampa, Florida with their two children. Victoria writes for industry leaders who desire a strong Internet presence. If you would like Victoria to write for your current website/blog or create a dynamic, search engine friendly WordPress website/blog that will rank high in the search engines, email Victoria at: victoria (@) getfoundnow.com.
Leigh Brown, aka The Real Estate Diva, is a native of Concord NC in the Charlotte area. She grew up on a farm at the edge of Cabarrus County, still goes to the same church she grew up in (home of the world famous Mallard Creek Barbecue!), but has become a leader in area real estate through constant learning and continually upgrading technology to better serve buyer and seller clients. Leigh does indeed have a reputation as a barracuda-when it comes to protecting client interests. Her softer side is reserved for her husband and two kids who provide a constant source of joy-and entertainment
