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FHA Quick Savings Tip Regarding Increased MIP Change

Risk Based Mortgage Insurance Premiums

July 14 2008 FHA implemented a new system for the Mortgage Insurance Premiums.

FHA Premiums has been normally 1.5% and have now increased up to 2.25% based on credit worthiness.

Money Saving Tip

There is a way to avoid paying the max tier of 2.25%.

Participating in a Pre-Purchase Counseling by a HUD approved counseling agency can cap your max tier at 2.0% for First Time Home Buyers.

You can find a list of approved counselors on HUD's main website Hud Approved Counseling

Key-Points to Counseling

Counseling must be completed before a signed purchase contract.
Must be one-on-one and face-to-face
Most Counseling is FREE or LOW COST. Many are FREE so choose wisely.
First Time Homebuyers are considered without a House in the past 3 years.

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Just-In-Time Loans - Mortgage Needs and Advice on Time. (757-228-3668)

Posted by Justin Williams - Loan Officer on 07/31/2008 11:19 PM

Comments (2)

virginia beach, virginia, fha, mortgage, loan programs, advice, tips, first time home buyer

This post has been included in Virginia Information Virginia Beach City County, VA Information Virginia Beach, VA Information
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2 Comments on FHA Quick Savings Tip Regarding Increased MIP Change

AUG

2008

Great post Justin, and a great tip for borrowers who need to close now.

Another way to beat it would be to wait until 10/01 when the risk based pricing goes away.

SEC. 2133. MORATORIUM ON IMPLEMENTATION OF RISK-BASED PREMIUMS.

(a) In General- During the 12-month period beginning on October 1, 2008, the Secretary of Housing and Urban Development shall not take any action to implement or carry out risk-based premiums, which are designed for mortgage lenders to offer borrowers an FHA-insured product that provides a range of mortgage insurance premium pricing, based on the risk that the insurance contract represents, as such planned implementation was set forth in the Notice published in the Federal Register on May 13, 2008 (Vol. 73, No. 93, Pages 27703 through 27711) (effective July 14, 2008).

(b) Insurance of Mortgages Under the National Housing Act- During the 12-month period beginning on October 1, 2008, the Secretary of Housing and Urban Development shall not take any action to implement or carry out any other risk-based premium product related to the insurance of any mortgage on a single family residence under title II of the National Housing Act, where the premium price for such new product is based in whole or in part on a borrower's Decision Credit Score, as that term is defined in the Notice described under subsection (a), or any successor thereto.

Interesting times, eh?

Gerry Suarez, Jr.

Your HUD Loan Pro!