According to more information from the FHA today, loans with case numbers assigned on or after April 5, 2010 will have increased premiums for home loans and refinance transactions.

So, this means you need to have an accepted offer by that date, which means you need to start looking no later than the beginning of March.

The premium is the charge that you pay when you close on your house in order to insure against default. (See yesterday’s post.)

The changes are as follows below:

Upfront premiums

1. Purchase money and full credit qualifying refinances will be 2.25% (It now stands at 1.75%)
2. Streamline refiancing (all types) will. be 2.25%
3. HOPE for Homeowners (delinquent mortgagors) will be 2.00%
4. Home equity conversion will be 2.00%

Annual premiums (what you pay on your monthly bill, also known as PMI) will remain unchanged and are as follows for loans over 15 years:

1. Loan to Value of less than or = to 95% is one half of a percentage point (or 50 BPS).
2. Loan to Value of less than 95% is 55 BPS.

To put in common English: We have some time before the higher premiums kick in so you need to start looking seriously soon. Rates and mortgage insurance premiums are at an almost all time low, but will almost certainly be higher by March.

Source: Dan Hlavac