FHA Commissioner Carol Galante, is employing very aggressive changes to the FHA & the changes will go into effect April 1, 2013 (NOTE: the old rules are in play until April 1st).The changes include raising minimum credit score requirements, raising downpayment requirements on jumbo-sized loans, and restricting access to FHA mortgages after a foreclosure…plus it will increase the mortgage insurance premiums it charges and they will require borrowers to pay mortgage insurance for the life of the loan.
On the aggregate, it will be more expensive to get a FHA as as with any loan it wil need to make sense.
Yes, it's true as Kevin said.
You'll want to closely compare an FHA loan to a conventional 97% loan. The guidelines have recently changed.
- 3% can be a gift, like FHA
- 3% down payment vs 3.5% FHA
- lower Mortgage Insurance premium.
-The Biggie- conventional MI will drop off at 78% loan to value.
FHA MI is for the life of the loan.
If you have low credit score issues, FHA is the way to
go. Otherwise, the total cost of borrowing with the 97%
conventional will be much lower.