FHA Insurance Premiums Going Up Over 63%

By Bill Petrey, Realtor

According to Texas A&M’s RECON newsletter, the Federal Housing Administration (FHA) is going to increase monthly insurance premiums starting with mortgage transactions created after October 4, so lock in your lower monthly insurance premium on FHA loans before the rates go up. After October 4th, we can expect to see monthly insurance premiums on FHA loans increase by over 63 percent.

How will this effect a new homebuyer? If you have a $193,000 FHA mortgage that requires insurance before October 4th you would only pay an insurance premium of $88.46 per month. After October 4th, that same loan’s insurance premium would jump to $148.01. That’s an increase of $59.55 taken out of your monthly income.

Original Source: >> Texas A&M’s RECON – Real Estate Center Online News – e-newsletter – August 31, 2010