As of April 1st
, 2013, the FHA's mortgage insurance (MIP) rules changed.
For homeowners trying to cancel MIP or otherwise refinance, after April 1, they will no longer be able to remove MIP (Mortgage Premium Insurance). This is costly for Buyers that planed on having it removed after the 5th year of their loan or once their Loan To Value Ratio was reduced to 78% of their original loan amount.
Anyone with an FHA loan completed or assigned by April 1st will be grandfathered in and still able to remove it. Anyone that is not assigned their Loan by April 1st will be stuck paying the additional premium for the FULL TERM of their loan or until they refinance with conventional financing.
On most FHA loans, the annual premium will increase by 0.10 percentage point, or $100 per year for each $100,000 in loan amount. Also, FHA is not changing the one-time premium borrowers pay up front; it remains 1.75% of the total loan amount.
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