The following changes to FHA loans are effective on all new case numbers dated July 14th and onward.
Standard FHA Risk Based Premium
Mortgage insurance premiums will now be risk based. Upfront MIP ranges from 1.25 to 2.25, while the monthly MIP can be either .50 or .55. Premium amounts are based on loan-to-value (LTV) and credit score.
Direct Mortgage Corp will continue to accept a minimum credit score of 580 or no credit score.
See Mortgagee Letter 2008-16 for the premium matrix and more details.
FHASecure Expansion
The FHASecure eligibility criteria have been expanded. As summary of changes appears below:
- All conventional rate and term refinances (ARM or Fixed) into an FHA loan are required to be done as a FHASecure.
- Conventional refinances into an FHA cash out (more than $500) will be done as a standard FHA
- Upfront MIP is 2.25 if refinancing a delinquent non-FHA ARM; if the LTV is > 95%, the monthly MIP is 0.55.
- Minimum 580 FICO®
- Standard county limits
- Allows a short pay (or write down)
- Allows Lates
- If LTV > 90%, then the following lates prior to rate reset are allowed
OR
- If LTV ≤ 90% then the following lates prior to rate reset are allowed
OR
See Mortgagee Letter 2008-13 for more details.
FHA Streamlines
Upfront mortgage insurance premiums have been reduced from 1.5 to 1.0.