FHA is in some financial trouble and as a result they made some changes to their rules lately. They now require that new FHA borrowers, as of April 1 2013, continue to pay mortgage insurance premiums for the life of the loan. An old FHA rule, dating from 2001, had allowed borrowers to cancel their mortgage insurance when their outstanding balance reached 78% of the original principal balance.
However, as of April 1, 2013 you will pay the FHA mortgage insurance for the life of the loan. However, Read the rest of this entry »