The Federal Housing Administration (FHA) has announced a new premium structure for FHA-insured mortgage loans that increases its annual mortgage insurance premium (MIP) by a quarter of a percentage point on all 15- and 30-year loans. The up-front MIP will remain unchanged at 1% and will impact new loans insured by the FHA on or after April 18. The FHA estimates that on average, new borrowers will pay approximately $30 more per month. Existing loans insured by the FHA will not be impacted by the pricing change.
Although this does not seem like a huge increase in itself, FHA has raised its annual MIP by .7% through multiple increases since last October. This means that your buyers could potentially qualify for less of a home after this deadline. If you have any buyers that are using FHA-insured financing make sure they complete their application prior to April 18th.