UFMIP Set to Increase for FHA Refinance and Purchase Mortgage Loans

A couple weeks ago, I touched on the Upfront Mortgage Insurance Premium (UFMIP) for FHA mortgage home loans. As a short recap, the UFMIP is a HUD “fee”, and is a percentage charge of total loan amount to a refinancing or home purchase borrower. The premium is paid upfront and is a part of closing costs. This “fee” goes to HUD and not the lender. HUD charges this premium in order to remain solvent and continue the FHA insured loan program.

Currently, the UFMIP for an FHA loan is equal to 1.75 percent of the borrower’s total loan amount. So, if your total loan amount, including closing costs is $200,000, the UFMIP will be $3,500.

Beginning in April of this year, the UFMIP percentage is moving up to 2.25% and will include FHA streamlines as well.

Long story short, if you are looking to do an FHA loan, getting your application in before the April deadline would be a good idea while mortgage rates are still low and the UFMIP is still at 1.75 percent. Under the new percentage, the UFMIP on a $200,000 loan amount is $4,500. That’s a $1,000 difference in closing costs between the 1.75 percent and 2.25 percent premium percentages. Nothing to sneeze at for sure.

Refinance mortgage rates have continued in steady fashion over the past week. There has been no major news to influence rates and the treasury yields have held in a nice tight range.

If you are considering a home mortgage refinance now and need some help, have questions, or need some competitive refinance rate quotes, please check out the popular Refinance Tool Box. Just give a call at 888-850-9888 or fill out a Rate Quote Request online for professional assistance without the aggressive high-pressure sales tactics.

May the Mortgage Refinance Rates be with You!

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