New Monthly Mortgage Insurance For USDA Loans October 1, 2012

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Real Estate Agent with RE/Max One | Sellers Agent

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.

close

Re-Blogged 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
Topic:
Lending / Financial
Tags:
usda monthly mortgage insurance
usda mortgage insurance

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Rainmaker
255,862
Michele Connors
The Overton Group, LLC & CB First Realty - Greenville, NC
Your Eastern North Carolina Realtor

Ive been using USDA for several yrs for some 1st time buyers needing 100%...Last yr when the MI was added I thought--oh know--here comes the end to something good..but, buyers still chose this option when making comparisons with others ( like FHA)... Now another increase, I will again say-- oh no.. and sit to see what this inncrease causes ! Thanks for the information, I did not know.

Aug 21, 2012 10:06 AM #1
Rainmaker
95,410
Brian & Val Mayer
RE/Max One | Sellers Agent - Huntingtown, MD
Listing Specialist | Realtor in Calvert County MD

~Michele its really not a big deal but it seems each change in lending for the past 24 months is negative. This program is definately a bright light in mortgage programs around here.

Aug 21, 2012 10:15 AM #2
Rainmaker
163,798
Reba Haas
Team Reba of RE/MAX Metro Eastside www.TeamReba.com - Bellevue, WA
Team Reba, CDPE

thanks for the head's up because if you've got a buyer who is just barely making it in the qualifying threshold then this could undo a deal. I've got one right now waiting to close and it's been 2 months of delays so far. Maddening!

Aug 21, 2012 01:32 PM #3
Rainmaker
95,410
Brian & Val Mayer
RE/Max One | Sellers Agent - Huntingtown, MD
Listing Specialist | Realtor in Calvert County MD

~Reba, two months of delays?? Yes you are right every little bit can make a difference

Aug 21, 2012 02:37 PM #4
Rainmaker
697,887
Lanre Folayan
Keller Williams Capital Properties-Buy a home in Washington DC. Sell a home in Washington DC - Washington, DC
How much is my Petworth DC House Worth?

Brian thanks for this info. This one is definitely worthy of a re-blog. By the way I am sorry I haven't called you yet like I said I was. Things have been hectic lately-PG COUNTY MD SHORT SALES. Need I say more :-)

Aug 21, 2012 02:59 PM #5
Rainmaker
95,410
Brian & Val Mayer
RE/Max One | Sellers Agent - Huntingtown, MD
Listing Specialist | Realtor in Calvert County MD

~Lanre, thank you! I understand and I am here when you need me!

Aug 21, 2012 03:26 PM #6
Rainer
209,575
Nan Jester
Exit Real Estate Gallery Jacksonville Beach, FL - Jacksonville Beach, FL
Realtor, Exit Real Estate Gallery

We do quite a few in outlying areas of Jacksonville.  Thanks for the info.

Aug 21, 2012 03:45 PM #7
Rainer
180,033
Tatyana Makarov
Coldwell Banker Residential Brokerage - South Windsor, CT
Your Greater Hartford Area Realtor

Thanks for the head's up, Briand. With all financing options available now it is hard to keep track what is happening.

Have a great week.

Aug 21, 2012 05:24 PM #8
Rainmaker
1,087,887
Joan Whitebook
BHG The Masiello Group - Nashua, NH
Consumer Focused Real Estate Services

USDA is a great program.  I was sad to see they excluded many more towns in my area making it very difficult to find towns where the loan can be utilized in So. NH.

Aug 21, 2012 05:35 PM #9
Rainmaker
95,410
Brian & Val Mayer
RE/Max One | Sellers Agent - Huntingtown, MD
Listing Specialist | Realtor in Calvert County MD

~Nan, your welcome!

~Tatyana If you have buyers who qualify for USDA my website has all the info you need http://usdaloanhome.com

~Joan, they are doing the same here October 1. More posts to come!

Aug 21, 2012 05:43 PM #10
Ambassador
400,851
Terrie Leighton
Ferrari-Lund ~ Reno's Premier Real Estate Company - Reno, NV
Reno Real Estate Agent ~ Selling Homes in Reno

Thanks for sharing this information. I am always talking about the USDA loan program and it would be embarrassing if I didn't have my facts correct. I am going to re- blog for my readers, thank you.

Aug 21, 2012 05:52 PM #11
Rainmaker
572,448
Wayne Johnson
Coldwell Banker D'Ann Harper REALTORS® - San Antonio, TX
San Antonio REALTOR, San Antonio Homes For Sale

Brian-As long as they keep the increases small and infrequent should be OK. Here's hoping the USDA program keeps getting funded.

Aug 21, 2012 06:13 PM #12
Rainmaker
979,170
Sharon Alters
Coldwell Banker Vanguard Realty - Fleming Island, FL
Your Fleming Island Relocation Agents.

Brian, thanks for the heads up about this. I haven't had a buyer who used USDA but have sold a few listings.

Sharon

Aug 21, 2012 09:06 PM #13
Rainer
132,161
Laura Murray
Weichert - Silver Spring, MD
Search Montgomery Co., MD for homes www.MDRealEstateOnline.com

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.

Aug 21, 2012 11:10 PM #14
Rainmaker
365,570
Kim Boekholder **Results Real Estate**
Results Real Estate 801.580.5624 - Sandy, UT
Broker, Selling Salt Lake Homes

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.  

Aug 22, 2012 04:31 AM #15
Rainmaker
95,410
Brian & Val Mayer
RE/Max One | Sellers Agent - Huntingtown, MD
Listing Specialist | Realtor in Calvert County MD

~ 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 

Aug 22, 2012 06:49 AM #16
Rainer
27,553
Alan Bercovitz
Guaranteed Mortgage Quote, LLC - Exeter, RI

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.

Aug 22, 2012 06:51 AM #17
Rainmaker
95,410
Brian & Val Mayer
RE/Max One | Sellers Agent - Huntingtown, MD
Listing Specialist | Realtor in Calvert County MD

~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. 

Aug 22, 2012 07:10 AM #18
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Rainmaker
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Brian & Val Mayer

Listing Specialist | Realtor in Calvert County MD
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