FHA PMI Insurance Rules Are Changing
Hello fellow investors,
I was just informed about some upcoming FHA regulation changes to the way PMI insurance is handled and assessed. Previously and currently, if you had a 30 year loan with a LTV greater than 78%, you would have a mandatory 5 years of PMI, even if you ended up having over 80% equity in less time.
FHA is changing the rules so most people will have PMI insurance which can NEVER be removed from the FHA loan. If you have a 30 year mortgage and greater than 90% LTV, you will have to pay PMI insurance for the life of the loan (30 years). This supposedly goes into effect on new loans starting 4/1/2013. Luckily my first property is under contract and hopefully I will close before 4/1/13.
Read more on the HUD website here: http://portal.hud.gov/hudportal/documents/huddoc?id=13-04ml.pdf