Nov 26, 2012
FHA to require PMI for life of loan
26 Nov 2012
Posted by Andrew Kantor
If you have clients thinking about an FHA loan, you should tell them to act quickly. Not only is FHA going to be raising the cost of its required mortgage insurance, it’s also going to require that the insurance be kept for the life of the loan.
Today, once a home’s loan-to-value gets below 78%, mortgage insurance isn’t required; that takes 10 years or so. A homeowner will typically pay several hundred dollars a month for mortgage insurance — a cost that, soon, won’t go away.
When will this happen? FHA hasn’t said, only that it will happen.