HUD has announced that there will be change in the UFMIP (Up-front Mortgage Insurance Premium) and monthly mortgage insurance premium (MIP). While the mortgagee letter is not out the buzz is getting out.
The new premiums will be effective with case number assignment as of October 4, 2010.
Here are the changes:
The UFMIP will drop to 1.0%: wow!
The reason for the changes below is to prop up the FHA Mutual Mortgage Insurance Fund which is "running out" and needs to be "pumped" up.
The monthly MIP for a 30 year fixed with maximum financing will be .90%-ouch
The monthly MIP for a 30 year fixed with 5% down will be .85%
Knowledge is power!