For those of you who have not read my bio… I’m second generation mortgage. My Dad was in this business – and my FIRST JOB? Was working for a PMI company at the age of 15, helping them MANUALLY prepare a MBS sale. That could be why I refer to ALL different types of Mortgage Insurance – as PMI.
If you put less than twenty percent down on a mortgage, you are going to pay some sort of Mortgage Insurance. This is not the kind of insurance that promises to pay your home loan off if you die or become disabled – this is the kind of Mortgage Insurance that pays the BANK if you don’t make your payments.
MOST of us refer to this as PMI.
FHA Mortgage “PMI” Rates for 2012
FHA insures mortgages, and their guidelines changed in April and June of 2012. They require an Up Front Premium (which is added to the Loan Amount) and a Monthly Premium (that’s sometimes called “Annual). These are the rates for loans up to $625, 500:
FHA PMI Rates 2012 for Upfront FHA PMI for loans up to $625,500: is 1.75% of loan amount
FHA PMI Rates 2012 for the Annual FHA PMI for loans up to $625,500 is 1.2% of loan amount if your down payment is 5% or more, or 1.25% of loan amount if your down payment is less than 5%. (so take this amount and divide by 12 to compute your monthly payment).
If you are applying for a FHA Loan OVER $625, 501 remember that those rates are slightly higher.
Additionally, if you want a FHA Streamline Refinance, and you have a current mortgage that was endorsed prior to May 31, 2009 – you may benefit from a “special” program” designed with much lower FHA PMI rates!
Conventional PMI Rates 2012
If you are looking for a Conventional Loan, and you have money for a down payment of less than 20% – Congress requires that the Bank “cover” itself with Private Mortgage Insurance. The Box below shows what coverage amount you will need, based upon what your downpayment, and length of the loan.
Now you know the 2012 PMI rates, calculating the monthly payments takes a few more minutes. There are at least 3 different types of Conventional PMI Programs you might want to explore.
Veteran Home Loan PMI Rates 2012
Veteran Home Loans also saw VA PMI Rates 2012 are actually lower! The VA PMI fee is a Guarantee fee, and it is charged at loan closing. Unlike FHA and USDA – the VA only charges an up front fee which is generally added to the loan amount.
Since most Veteran home loans are funded with no money invested for a downpayment, the Funding Fee on those loans is 1.4%. This is the charge for those Veteran’s that are first-time users of their entitlement and who are on active duty or honorably discharged.
Funding Fees for subsequent use of entitlement is 2.8% (More details).
USDA Home Loans are no money down home loans that are generally easy to qualify for! (More details on qualifying for a USDA Home Loan in NC)
· 2 percent Upfront Guarantee Fee for purchase transactions. This means that if you are purchasing a $100,000 house, the loan will be $102,000; OR, you can pay the 2% out of your pocket… or see if you can get the Seller to pay it. We are NOT seeing many situations where the Seller is doing this, but if you have extra funds, you can go ahead and pay this off. Unlike FHA, the Guarantee Fee (or Mortgage Insurance Fee) is not refundable.
· 0.3 percent AnnualFee for purchase transactions. This means that if you purchase a $100,000 house, with a $102,000 loan on it, you will pay a MONTHLY Insurance fee of $34 ($102,000 x .4% = $408 divided by 12 months = $34 a month)
If you are looking for a home to purchase and have questions, please call Steve and Eleanor Thorne 919 649 5058. We can help you with a FHA Streamline Refinance, a USDA No Money Down Home Loan, a VA Home Loan or getting the best rate on a Conventional Mortgage!
I try and answer all questions :)