Just a quick UPDATE on upcoming changes to FHA Mortgage Insurance for both up front and monthly mortgage insurance premiums.

Recent mortgagee letter announcing change to FHA Mortgage Ins. Premiums.

FHA Upfront Mortgage Insurance Premium and Annual/Monthly MIP Factor Changes

* HUD announced that effective with case numbers assigned on and after October 4, 2010, new Mortgage Insurance Premium Factors apply to both Upfront MIP and Annual/Monthly MIP.

* UFMIP (Up Front Mortgage Insurance Premiums) is decreasing from 2.25% to 1.00% on all FHA Transactions. (this fee is financed into the loan up front)

* Annual/Monthly MIP is increasing for Amortization greater than 15 years:

>>And LTV (loan to value) less than or equal to 95% from .50% to .85% (monthly PMI will be calculated higher)
>> And LTV (loan to value) greater than 95% from .55% to .90% (monthly PMI will calculated higher)

Annual/Monthly MIP factors with an Amortization less than 15 years has No Change:

* LTV less than or equal to 90% remains at 0.00%
* LTV greater than 90% remains at .25%

This is affective for all new FHA loans just wanted you to be aware for your buyers.

Contact Linda Franklin @ Bank of America for more details