mortgage

7 crucial facts about FHA loans

Mortgage insurance is a must
Mortgage insurance is a must © Jakub Krechowicz / Fotolia.com

Mortgage insurance is a must

Two mortgage insurance premiums are required on all FHA loans: The upfront premium is 1.75 percent of the loan amount -- $1,750 for a $100,000 loan. This upfront premium is paid when the borrower gets the loan. It can be financed as part of the loan amount.

The second is called the annual premium, although it is paid monthly. It varies based on the length of the loan, the amount borrowed and the initial loan-to-value ratio, or LTV.

Annual premiums for FHA loans

  • 15-year loan, down payment (or equity) of less than 10 percent: 0.7 percent
  • 15-year loan, down payment (or equity of 10 percent or more): 0.45 percent
  • 30-year loan, down payment (or equity) of less than 5 percent: 1.35 percent
  • 30-year loan, down payment (or equity) of 5 percent or more: 1.3 percent

advertisement

Show Bankrate's community sharing policy
          Connect with us
advertisement
MORTGAGE & REAL ESTATE NEWSLETTER

Timely market news and advice for consumers ready to buy, sell or invest in real estate. Delivered weekly.

Blog

Polyana da Costa

Bullish jobs report bad for rates?

The employment report released this morning is great news for the economy but not so much for mortgage borrowers.  ... Read more

advertisement
Partner Center
advertisement

Connect with us