FHA is changing the mortgage insurance premiums for those that want to refinance. Effective with all FHA case numbers pulled on or after June 11, 2012, the mortgage insurance will drop for those that are refinancing FHA loans that were endorsed by June 1, 2009.
On June 11th, FHA is reducing the upfront mortgage insurance on refinances from 1.75% to .01%!!! They are also reducing the monthly mortgage insurance to .55% from 1.25%. Many people that had FHA mortgages were finding it didn't make sense to refinance based on the new mortgage insurance premiums. FHA decided that they would reduce the numbers to allow more people to take advantage of the lower rates.
This is effective only for those mortgages that were endorsed by June 1, 2009 – that doesn't mean closed, it means that FHA/HUD has actually received the mortgage and issued a mortgage insurance certificate - it can take several weeks after closing at times.
We are taking applications for the reduced rates now, you do not need to wait until June 11th. We will wait to pull the FHA case number until on or after the June 11th date.
If you qualify for a FHA streamline refinance with the new changes, it is a great time to refi. The FHA rates are lower than we have ever seen them! It may be possible to refinance to a lower rate, not need an appraisal and do a no-cost refinance so you don't have to roll the closing costs into the mortgage!
Leslie Vanderwerf, NMLS ID#335509, Summit Mortgage - Email – Website
I am aware that my previous refinance would have had to have taken place prior to May 31, 2009. Unfortunately, this was not the case as my loan was closed May 12, 2009 and endorsed on June 8, 2009. I’m assuming that many other individuals are going to experience a similar reality. My question is do you think the endorsement date will later be extended to allow many others to be able to refinance in this current low interest rate environment? If so, do you have an idea when this may take place? Any help here would be most appreciated.
I agree that there will be many people in your situation unfortuantely! It has been the same way with the HARP conventional loans also. For most people that have FHA loans that were endorsed after June 1, 2009, it probably will not make sense to refinance with the increased MI rates. I have not heard anything at all about extending the date to all others to refinance with the new rules. If I do hear something, I’ll update the information!