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FHA to Raise Monthly Mortgage Premiums Again

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Mortgage and Lending with Embrace Home Loans, Inc.

FHA to Raise Monthly Mortgage Premiums Again

For all FHA case numbers assigned on or after April 18, 2011, FHA will be raising the Monthly Mortgage Premium (MMP) 25 basis points (0.25).  For mortgages with terms greater than 15 years if the LTV is ≤ 95%,  the MMP is currently 85 basis points and will rise to 110 basis points, if the LTV is > 95% the MMP is currently 90 basis points and will rise to 115 basis points.
For mortgages with terms ≤ 15 years, currently there is no MMP for loans with the LTV ≤ 90% and will rise to .25 basis points, if the LTV is > 90% the MMP is currently 25 basis points and will rise to 50 basis points.

FHA after April 18, 2011 will also automatically cancel the case number of any uninsured case number that has had no activity for 6 months unless certain conditions are met.

See FHA Mortgagee Letter 2011-10 for more details.

Will this affect borrowers?  You bet it will!  This increase works out to the equivalent of about 0.34% higher in interest rate on every FHA loan.

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FHA loans for owner-occupied purchases to scores as low as 540.
FHA Streamline refinances down to 580 credit scores.

Conventional loans for up to 10 financed properties for qualified investors.
Homepath financing available.
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Maryland CDA and DSELP loans available to qualified homebuyers.

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Bill Rozek, Senior Loan Officer     NMLS # 214260
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