San Jose, CA FHA Loans Annual Mortgage Insurance Premium Going Up in April, 2011

The recent FHA announcements show further increase in Annual Mortgage Insurance Premium on standard San Jose, CA FHA loan programs. There was an increase in October 2010 and now for the second time the premium increased within a period of six months.
Here are the important changes with effect from effective from April 18th 2011. 1. For standard forward mortgages there will be .25% increase in Annual Insurance Premium. The Upfront Mortgage Insurance is still at 1.00%. 2. For LTVs GREATER than 95% on 30 year loans the Annual Premium comes to 1.15%. 3. For LTVs EQUAL to or LESS than 95% on 30 year loans the Annual Premium comes to 1.10%. 4. For LTVs GREATER than 90% on 15 year loans the Annual Premium comes to .50%. 5. The Annual Premium is now .25% for LTVs EQUAL to or LESS than 90% on 15 year loans. You can get a clear idea on how these changes are going to affect from the chart below.
It will be more expensive for you to buy or refinance a home in San Jose, CA using FHA loans as a result of this change. Therefore if you are looking for a home, it is better to get into contract before April 18, 2011 to save the .25% of loan amount every year (for at least five years). If you need full details on FHA Mortgagee Letter 11-10 which explains about the change to San Jose, CA FHA Annual Mortgage Insurance Premium, you can Click Here.

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Shashank Shekhar

Mortgage Broker/Banker | San Jose, CA

(408) 615-0655 | Shashank@ArcusLending.com

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Comment balloon 1 commentShashank Shekhar • February 24 2011 08:36AM
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