On Thurs., Jan. 21st, FHA announced two important changes to their financing guidelines.
First, effective 4/5/2010, up-front mortgage insurance premiums will increase from 1.75 to 2.25%. Since this mortgage insurance is usually rolled into the financing, it will not increase the buyer’s cash required to close and would only increase the onthly payment by $11/month on a $400,000 purchase price.
Second, FHA will reduced the maximum closing costs to be credited to the buyer from 6% to 3%. Since 3% usually covers the buyers closing costs anyway, the buyer really will not need to come up with much extra money to cover closing costs. And the buyer is only putting 3.5% down on the loan so they should be able to pay the small extra amount they may need for closing costs.
Please call Marilyn Dashe at Sea Coast Exclusive Properties at 760-803-4304 if you have any questions about these new FHA regulations.