For those people that are thinking of buying a home in Logan, Utah with an FHA loan, there is a change occuring on April 5th that will make your FHA loan a tad bit more expensive.
Effective on all FHA case #'s assigned on and after April 5th, the upfront mortgage insurance premium is increasing from 1.75% to 2.25%. On a $100,000 mortgage, that is an extra $500 dollars on your mortgage.
The FHA upfront mortgage insurance is the only closing cost that can be rolled into the mortgage and this won't change but the increase will mean that your monthly payments will be a little bit higher than with the previous 1.75% Upfront fee.
The president of HUD said that this change is necessary to help FHA shore up some of the losses that they have incurred due to foreclosures.
Personally I don't think that this will affect the market very much, if at all, and FHA will still be the best option for many borrowers.
About the Author
John Neil is a loan officer that is passionate about his profession. His goal with every transaction is to make a customer for life. The result is that 95% of his business comes from referrals of satisfied clients. If you need a cache valley mortgage, you can contact John at 435-770-2709. You can also follow him on twitter @LoganUTMortgage or facebook @facebook/MortgageNerd
John - Thank you for sharing an informative and helpful blog.
John