FHA Mortgage Insurance Premiums

FHA Mortgage Insurance

When it’s time to buy a home first time home buyers like to utilize FHA financing because it allows for a down payment as low as 3.5%. Since the the down is lower than the traditional 20% down payment, the buyer must pay for additional mortgage insurance which of course means, premiums will need to be applied. Basically, the buyer must pay for mortgage insurance to protect the lender.

Thankfully, the cost of mortgage insurance has been greatly reduced in recent years. Why? Competition between insurance providers is fast and furious and it’s the buyers who benefit the most!

For example, back in the years before 2018, the cost of mortgage insurance on a $400K loan might have been approximately $400 per month. As of 2021, that cost was closer to $150. It makes sense, if you can qualify for a low down payment loan and buy a first home, go for it! Just so you know, as of 2022 a decent condo home can still be purchased here in Santa Clarita for under $500K. See for yourself by looking at all condos for sale in Santa Clarita.

Finding Condos Approved for FHA

First time condo buyers sometimes become a bit frustrated trying to find a suitable condo in a complex that is already approved for FHA financing. We’ve made life much easier by providing you with an up to date list, including links to listings in ALL Santa Clarita condo complexes that are pre approved for FHA financing.

 Mortgage Insurance Premiums

The amounts listed below were published in early 2019 and although they are always changing, they at least offer a starting point so buyers will know the type of questions to ask a lender when considering FHA financing.

  • 15-year loan terms with loan-to-value over 90% : 0.70 percent annual MIP
  • 15-year loan terms with loan-to-value 90% and under : 0.45 percent annual MIP
  • 15-year loan terms with loan-to-value over 90% Loan Amount greater than $625,500: 0.95 percent annual MIP
  • 15-year loan terms with loan-to-value over 78% up to 90% Loan Amount greater than $625,500: 0.70 percent annual MIP
  • 15-year loan terms with loan-to-value 78% and under Loan Amount greater than $625,500: 0.45 percent annual MIP
  • 30-year loan terms with loan-to-value over 95% : .85 percent annual MIP
  • 30-year loan terms with loan-to-value 95% and under : .80 percent annual MIP
  • 30-year loan terms with loan-to-value over 95% Greater than $625,500 : 1.05 percent annual MIP
  • 30-year loan terms with loan-to-value 95% and under Greater than $625,500 : 1.00 percent annual MIP

General Conventional MI Rates (Assuming 760+ scores)

  • 15-year loan terms with loan-to-value 97% to 95.01% .37%
  • 15-year loan terms with loan-to-value 95% to 90.01% .30%
  • 15-year loan terms with loan-to-value 90% to 85.01% .24%
  • 15-year loan terms with loan-to-value 85% and under .18%
  • 30-year loan terms with loan-to-value 97% to 95.01% .55%
  • 30-year loan terms with loan-to-value 95% to 90.01% .41%
  • 30-year loan terms with loan-to-value 90% to 85.01% .30%
  • 30-year loan terms with loan-to-value 85% and under .19%

Planning to use FHA Financing to Buy a Home Soon?

If you’re thinking about buying a home, contact us to schedule a consultation. 661-713-4799! We’ll get you set up with Keith Renno for a quick pre-qualification and a follow up for a pre approval.

Even repeat buyers that have the ability to put 20% down and obtain a conventional loan still like the FHA financing because it allows them to keep a good amount liquid and a low long term fixed rate.

Matt Meray Gregory Realtors and Brokers
NAR Realtor Designations