FHA Mortgage Insurance

So, how long do you pay FHA mortgage insurance?

Summer 2013 is in full effect and in a few months will be over. But for the FHA mortgage insurance that’s paid on FHA loans monthly; that will now remain in effect longer than before. Yes, new FHA loans that have originated on June 3rd and after will now pay the FHA monthly mortgage insurance for either 11 years or the whole term of the loan.

So, if you are a homebuyer or homeowner looking to take out an FHA loan with or without renovation funds then here is what you should know on how long your mortgage insurance could remain on your FHA home loan…

If the initial mortgage financed is 15 yrs or less and your Loan to Value (LTV) is 90% or less of the purchase/ refinance value then 11 years is the time frame category you would fall into. Above 90% would be the whole term.

If the initial mortgage financed is 30 yrs and your Loan to Value (LTV) is 90% or less of the purchase/ refinance value then 11 years is the time frame category you would fall into. Above 90% would be the whole term.

Another way to translate regardless of loan term… a purchase with a 10% down payment would put you on the 11 yr. mortgage insurance tract and less than 10% , the whole term of the loan. Same 10% applies to refinancing.

Now regardless of what category you fall into keep in mind Conventional loans above 80% LTV also require mortgage insurance. In other words, something to be aware of and that needs to be taken into consideration in any type of home financing that would require this type of insurance.