For a $400,000 loan, this would make the monthly mortgage insurance premium go from $183.33 to $ 300. The higher premium is being required by FHA to shore up its capital reserves which have been depleted over the last couple of years due to the large number of FHA loans that went delinquent and were foreclosed.
On the positive side, the upfront mortgage insurance premium that FHA charges is being reduced from 2.25% to 1.0%. This change will take effect on October 4th as well.
These aren’t the only changes that FHA is undergoing.
There is talk that maximum seller concessions are going to be reduced from 6% of the sales price to 3%. According to FHA these are necessary changes that needed to be made to keep the program viable.
For more information on FHA financing please contact Honolulu HomeLoans at 681-7500.
For more information, contact Anders Hostelley, EVP Loan Origination, Home Loan Manager, Honolulu HomeLoans, Inc., 745 Fort Street, Suite 1001 Honolulu, Hawaii 96813