If you live in Arizona and are wanting an FHA loan, the mortgage insurance premiums are about to change. Here are the changes to the FHA mortgage insurance premium that goes into effect for FHA case numbers issued after April 1, 2013.
In addition to the increases in the FHA UFMIP listed above, there are a couple of other changes to the FHA loan program as well.
It used to be that FHA would have a candellation policy where you could get the FHA mortgage insurance cancelled when the outstanding principal balance reached 78 percent of the original loan balance. Starting April 1, FHA has changed the rules and homeowners will now be required to pay mortgage insurance for the life of the loan.
Getting a jumbo FHA loan will also get more expensive – FHA is raising the down payments for FHA jumbo loans from 3.5 to 5 percent (although this won’t impact AZ – it will impact CA and other high-cost areas).
If you have a credit score below 620, FHA will require that the lender manually underwrite the loan. This doesn’t mean that you won’t get approved for an FHA loan if you have a credit score below 620, but you can expect it to get much harder.
If you are in the market for an FHA loan, the good news is that it is still one of the best loan programs out there for people who need to get a mortgage. The bad news is that regardless of what lender you choose to work with, guidelines just got harder (making it harder to get a loan) and if you do get approved, it also just got more expensive.
The easiest way to get approved for an FHA loan is to shop lenders and get the lowest rates and fees while getting approved today.