Why Is My Financed Loan Amount On My FHA Loan Bigger?

Buying or refinancing a home? An FHA loan much like a USDA loan, has two forms of mortgage insurance. There is an upfront mortgage insurance premium, UMFIP for short, which is based upon 1.75% of the base loan amount ( difference between the down payment amount or appraised value relative to equity) which is then added to the loan, creating the financed loan amount.

The financed loan amount is what the principal and interest payment is based off of as well is what the term of the loan is based off of. Additionally, there is a monthly factor typically about 1.3% of the loan amount before upfront mortgage insurance is factored in. So it’s important to remember when looking at FHA loans there is two forms of PMI, an upfront premium paid to HUD and then a monthly factor as well.

Planning to buy a home? If you have an FHA mortgage now, maybe refinancing might make more sense? Start today by getting a complimentary mortgage rate quote for an FHA loan or another mortgage type its online fast and free.

 

Posted in:

RELATED MORTGAGE ADVICE FROM SCOTT SHELDON

Here's a strategy to buy a home and set up a future refinance

Here’s a strategy to buy a home and set up a future refinance

For families looking to purchase a home, good news has arrived interest rates are slowly…

How your financial experience might hinder your ability to get a mortgage loa

How your financial experience might hinder your ability to get a mortgage loan

Getting a loan to buy a home is a maze of questions, examinations, along with…

Here’s how to buy a house even if you think your income may not qualify

Here’s how to buy a house even if you think your income may not qualify

If you’re looking to get prequalified to buy a home, one of the main elements,…

Scott Sheldon's The Mortgage FIles Blog

FHA Mortgage Insurance Premiums reduced by 30 basis points-what this means for consumers

For folks looking to purchase or refinance a home with the FHA Loan, the Federal…

View More from The Mortgage Files:

1 Comment

  1. […] the lender considers this to be a less-risky property type. Modular homes can be financed with an FHA Insured Loan up to 96.5% financing and with a conventional loan up to 95%, for a borrower’s primary […]



begin your mortgage journey with sonoma county mortgages

Let us make your mortgage experience easy. Trust our expertise to get you your best mortgage rate. Click below to start turning your home dreams into reality today!