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PMI new rules

Recently refinanced to a lower interest rate. One month later HUD announced new PMI laws, am I stuck with the new increased PMI payment?  I contacted the bank and they knew about the new PMI changes but did not inform us.  The new PMI payment is $230 more a month than old PMI payment.  What can I do?
  • July 05 2012 - Manassas
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Answers (4)

gosh James, does your E&O know you're providing mortgage advice, albeit incorrect advice at that, without an originator's license?

1) on all mortgages with an original principal obligation less than or equal to 90 percent LTV, the annual PMI will be assessed until the end of the mortgage term..
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wrong in too many ways to itemize. just wrong.

2)  FHA will assess the annual PMI 
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FHA has never assessed PMI and isn't do so now either; PMI is something you might see with a conventional mortgage but not FHA.
  • June 04 2013
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Don't worry you are safe.  Under the circustances you mentioned your PMI payments will not change. 

Two key factors to note with the change in PMI is that as of April Fools day 2013 ( 4/1/2013), and believe me this is no April Fools joke, on all mortgages with an original principal obligation less than or equal to 90 percent LTV, the annual PMI will be assessed until the end of the mortgage term or for the first 11 years of the mortgage term, whichever occurs first.

If the LTV greater than 90 percent, FHA will assess the annual PMI until the end of the mortgage term or for the first 30 years
of the term, whichever occurs first.
  • June 04 2013
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Are you saying you closed the loan with the $230 higher monthly MI payment? If not and your current payment is $230 less than what it would be now, then you have nothing to worry about as it cant change unless you refinance again. A client read something like that from a Streamline mailer
 ( from a Credit Union.....) and it was very deceiving, made it sound like the borrower's MI payment was going up unless they acted. I told her to mail that...notice... to HUD for review. 
  • July 05 2012
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Hi user9,

Certainly they cannot retroactively change your PMI...if your loan is closed, no matter how they may change PMI payments, it would only affect new loans, not closed loans.

Regards, Jim
  • July 05 2012
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