Home Loans Arizona - California - Nevada - Utah

The reason for the since of urgency is that cost of doing business with HUD on FHA home loans will increase April 1st 2012. They are increasing the upfront mortgage insurance premium and the monthly insurance payment. With these small but noticeable increases, will ultimately lower the purchasing power of our buyers, so if you are looking to purchase a home, do it NOW and that will ensure you will have an established FHA case number before April 1st 2012.

Here are the changes:

• For loans under $625,500, MIP monthly premiums will rise from 1.15% to 1.25% of the loan amount, starting April 1st 2012.
• For larger loans, annual premiums (paid monthly) will increase by 0.35 of a percentage point to 1.5% of the loan amount, starting June 1 2012.
• For all loans, the upfront fee will increase from the current 1% to 1.75% of the loan amount.

The math for a $200,000 home purchase with 3.5% down and a mortgage of $193,000:

Under the new rules, the borrower's upfront mortgage premium would increase to about $3,377 from $1,930, which most people would wrap into the total mortgage amount. So taken together, both the upfront and annual premium increases would translate to a higher monthly payment of about $25, or $1,291, according to calculations