New Monthly Mortgage Insurance For USDA Loans October 1, 2012

By
Mortgage Banker with C&F Mortgage | No Money Down Mortgages 224624

New USDA Mortgage Insurance

 

usda mortgage insurance

As of October 1, 2012 the annual MI on all USDA loans is increasing from .3% to .4%. This should not be a huge concern as the rate is still relatively low especially compared to FHA which is at 1.25%.

On a 200k loan the usda monthly mortgage insurance will go from $50 per month to $66.67 per month a difference of $16.67. The up front MI will stay the same at 2% for new purchase.

USDA Refinance

 

On USDA Refinances (which are currently out of funds until at least October 2012) will also incur an annual MI increase from .3% to .4%. The up front will increase from 1.5% to 2% to match the structure of new purchase.

The way the annual rate is calculated is to take the original loan amount and multiply it by .004 (this will give you the annual) then divide it by 12 which will give you the monthly cost. 200,000 x .004 = 800 / 12 = 66.66

USDA Loans are still an extremely strong loan compared to FHA and Conventional and with no down payment requirement its a no brainer for most people who qualify.

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Re-Bloggged 2 times:

Re-Blogged By Re-Blogged At
  1. Lanre Folayan 08/21/2012 03:03 PM
  2. Terrie Leighton 08/21/2012 05:57 PM
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Topic:
Lending / Financial
Tags:
usda monthly mortgage insurance
usda mortgage insurance

Comments 18 New Comment

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Rainer
130,212
Laura Murray
Search Montgomery Co., MD for homes www.MDRealEstateOnline.com
Weichert

Thanks for the update.  Again as a Realtor it is so important to have a relationship with a good mortgage provider, so you know if your client is getting "good" help.

August 21, 2012 11:10 PM
Rainmaker
358,448
Kim Boekholder **Results Real Estate**
Broker, Selling Salt Lake Homes
Results Real Estate 801.580.5624

Thank you for the information.  I don' have a lot of buyers who use USDA  loans  but its always great to know whats going on for the buyer who needs it or ask about it.  

August 22, 2012 04:31 AM
Rainmaker
94,985
Brian Mayer
USDA Loan | Rural Development Loan
C&F Mortgage | No Money Down Mortgages

~ Terrie, Thank you!

~Wayne, I agree the program is still considerably better than FHA

~Frank, if you do make sure you use a LO who has done a few before

~Laura, I agree my Realtor partners know their clients are in good hands

~Kim, Your welcome, I agree that Realtors dhould have a basic knowledge of most programs 

August 22, 2012 06:49 AM
Rainer
27,553
Alan Bercovitz
Guaranteed Mortgage Quote, LLC

USDA has also sent out a notice warning folks that some USDA offices are so far behind that they may not be able to make October 1 closings even for loans submited now.  And it's the closing date that determines whether the old or new charges apply.  I hope your USDA office isn't one of the backlogged ones.

August 22, 2012 06:51 AM
Rainmaker
94,985
Brian Mayer
USDA Loan | Rural Development Loan
C&F Mortgage | No Money Down Mortgages

~Alan, in MD they are still turning files in 1-2 days, I am getting one out in a few hours from now that was submited yesterday. Sorry to hear you are havng such trouble. 

August 22, 2012 07:10 AM
Anonymous
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Rainmaker
94,985

Brian Mayer

USDA Loan | Rural Development Loan
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