Let’s look at the math for a 30 year fixed FHA loan at 4.875%

Current rules FHA Cost:

Purchase Price: $400,000

3.5% down: $14,000

2.25% upfront fee: $9000

Total Loan Amount: $394,685

Principal and interest: $2088.71

Taxes (estimated): $322

Insurance (estimated): $80

Mortgage Insurance: $175.70

Total Monthly payment: $2667.33

NEW AS OF OCTOBER 4TH FHA Cost:

Purchase Price: $400,000

3.5% down: $14,000

1% upfront fee: $4000

Total Loan amount: $389,860

Principal and interest: $2063.17

Taxes (estimated): $322

Insurance (estimated): $80

Mortgage Insurance: $287.52

Total Monthly payment: $2753.61

Although the monthly payment is higher for the first 5 years (You have to pay mortgage insurance for 5 years) with the new rules if you keep the loan for the full 30 years you will actually save about $2485.  Where this will become an issue is with “cusp” borrowers.  Borrowers who were max qualified at a certain amount will now qualify for less.

Written by Jennifer Ready www.Readybell.com

If you are purchasing or refinancing a home with a loan (not FHA)

DO NOT BUY ANYTHING WITH YOUR CREDIT CARDS.

As of June 1st Fannie Mae is requiring lenders to check the borrowers credit right before funding.  If anything changes on your credit your loan that you already have signed loan documents on could be denied.   In order to protect yourself

1) DO NOT BUY ANYTHING WITH YOUR CREDIT CARDS OR OPEN NEW LINES OF CREDIT.

2) PAY YOUR CREDIT CARDS ON TIME

3) DO NOT ALLOW ANYONE TO RUN YOUR CREDIT.

By following the three above rules you will have no problems.  If you decide to go against any of the above you could be setting yourself up for disaster.