Articles Tagged With: Mortgage Insurance

November 16, 2010

What is FHA Mortgage Insurance For?

On the surface, FHA mortgage insurance seems designed mainly to protect the lender's interest. FHA mortgage insurance is designed to mitigate the bank's losses in case the FHA loan goes into default and foreclosure. But this insurance does more than just protect the FHA lender--it also helps the buyer. The Housing and Economic Recovery Act of 2008 requires FHA mortgage insurance on all new FHA mortgages. The FHA loan applicant must, once approved, pay for this insurance--costs that include an up-front mortgage insurance premium and monthly insurance payments along with the mortgage. The fees and terms of FHA mortgage insurance depends on what kind of FHA loan the borrower wants. Other factors include the length of the loan term, and loan amount to property value ratio.

November 15, 2010

FHA PowerSaver Loans Announced

By Joe Wallace

In November 2010, the Department of Housing and Urban Development announced a pilot program that offers qualified FHA loan applicants a low-cost loan to help homeowners install energy saving upgrades to their homes. The new FHA PowerSaver loan is scheduled to be offered in conjunction with a program called Recovery Through Retrofit which was launched by Vice President Joe Biden in 2009. The new FHA PowerSaver loan is substantial--up to $25,000 for qualified FHA loan applicants--and can be used to install insulation, solar panels, geothermal energy systems and much more.

November 11, 2010

Does the FHA Require an Escrow Account for FHA Mortgages?

By Joe Wallace

In our last post, we discussed escrow accounts, which a lender may require to be set up in connection with an FHA loan in order to pay mortgage insurance, property taxes and other expenses with no fear of missed payments or penalties for late payments. When a lender sets up an escrow account in the buyer's name for these purposes, they often add the costs of the insurance and other payments into the mortgage, making one simple payment for the buyer. The extra money is placed into escrow and held until it is needed to pay the insurance, taxes or other items.

November 11, 2010

What is an Escrow Account and Why Do I Need One for an FHA Loan?

By Joe Wallace

If you're thinking of buying that first home, you've probably read plenty of real estate articles and brochures with a wealth of new vocabulary. One of these is "escrow". Until applying for an FHA home loan, many people have never needed an escrow account so it's no surprise that "What is an escrow account and why do I need one for an FHA mortgage?" is such a common question.

November 9, 2010

Don’t Pay a Tracer to Track Down An FHA Refund

By Joe Wallace

FHA borrowers with loans acquired after September 1, 1983 may be entitled to a partial refund of their up front mortgage insurance premium. According to the FHA official site, borrowers could be eligible if they paid the UFMIP premium when the loan closed and did not default on their mortgage payments. Refund eligibility is determined by the FHA based on a number of factors including how many months the loan was insured.

November 9, 2010

Does the FHA Owe You a Refund?

By Joe Wallace

FHA loan applicants go into the process expecting to pay money for a down payment, mortgage insurance, closing costs and the typical fees associated with getting an FHA mortgage. What they don't expect is to get money back from the Department of Housing and Urban Development. But in some cases, that's exactly what they'll get.