TEXAS FIVE STAR REALTY

FHA Lowers Mortgage Insurance Premiums Effective January 26th 2015

The Federal Housing Administration (FHA), a government insurer of home loans, cut 50 basis points (0.50%) from the annual mortgage insurance premium for FHA backed loans with terms greater than 15 years. For most FHA loans this will reduce the annual premium from 1.35 percent of the loan balance to 0.85 percent for case numbers assigned on or after January 26, 2015.

This Mortgagee Letter 2015-01 includes a table which shows the current and new annual MIP rates by amortization term, base loan amount, and loan-to-value ratio. 

The following table shows the existing and the new annual MIP rates by amortization term, base loan amount and Loan to Value (LTV) ratio.

All New MIP amounts set forth in this table are effective for case numbers assigned on or after January 26, 2015.

For the typical FHA applicant in Collin County Texas with average loan amount of $250,000, the reduction in premiums means a savings of about $104 on their monthly payment.

Case Cancellation

To allow mortgagees to obtain the reduced annual MIP rates contained in this ML for loans in process with active FHA Case Numbers, FHA will temporarily approve cancellation requests for active FHA Case Numbers within 30 days of the effective date of this ML.

For more information please see HUD web page at Mortgagee Letter 2015-01

This article can also be found in http://www.texasfivestarrealty.com/FHA_Lowered_MIP_Jnauray26_2015.asp

 Contact Bahman Davani at: http://www.texasfivestarrealty.com/Contactus.asp