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Raleigh Home Loans getting more expensive.

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Home Loans in Raleigh are about to get more expensive (FHA that is). If you are thinking about buying a new home under the FA program, you should consider making your move before June 1st 2013.
The Federal Housing Administration is making some major changes in their fee structure and they will directly hit your pockets. Under the current payment schedule, if you put the usual 3.5% down on a 30 year mortgage, you pay approximately $192 a month on a $200,000 home. But your Raleigh home loan payment will be about $50 a month more comes June.
But the FHA did not stop there. Even more drastic changes will come to the mortgage insurance premiums as it pertains to its cancelation. Currently the MIP on a 30 year term loans with 3.5% down payment stays for a minimum of 5 years but it drops once you reach 22 % equity. Under the new rules your MIP will stay for the life of the loan regardless of how much equity you have. If you put 10% down or more, you will need to keep the MIP for 11 years. Awch!

I think that FAH is sending us a very clear message – go ahead get an FHA loan but do refinance out of it in a few years.
So what can you do to avoid this increase? Well, for starters try to get the loan secured, specifically FHA case number pulled (mortgage speak…) before June 1st of this year.

Next, if you have a credit score of 660 or more and are able to put 5% down, consider a conventional loan. So far, there is no news of the mortgage insurance premium raising on conventional al home loans.

If your score if not exactly 660, but somewhere between 620-660, you can get the FHA loan and wait about 6-8 months. If you make your payments on time, your credit score is likely to increase to the 660 required to refinance into a conforming loan. But keep in mind that most lenders will want to see at least 6 payment made before they let you refinance.

Home Loans in Raleigh are getting more expensive but the good news is that rates are still very low and that eases the pain of home loan financing.

If you have any questions about the raising MIP or would like to request rate and payment quote, or if you just want to chat about the landing environment, please call me! I would love hear from you.

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Edyta Rhodes has written 25 articles on Service 1st Mortgage

I am an experienced mortgage broker, Raleigh-based with access to top national lenders. I have over 10 years experience, so I know how to design your mortage loan to fit your overall financial picture. I guarantee to find the best mortgage rate for you. You can find out more about me on Google+ Or you can email me at erhodes@nc.rr.com

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