<h1 style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; line-height: 19px;">New USDA Mortgage Insurance</h1><p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;">

<p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;"><img title="usda mortgage insurance" class="alignright size-full wp-image-711" src="http://www.usdaloanhome.com/rural-development/usda-mortgage-insurance.jpg" height="226" alt="usda mortgage insurance" width="300" style="cursor: default; float: right;" />

<p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;">As of October 1, 2012 the annual MI on all USDA loans is increasing from .3% to .4%. This should not be a huge concern as the rate is still relatively low especially compared to FHA which is at 1.25%.</p><p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;">On a 200k loan the usda monthly mortgage insurance will go from $50 per month to $66.67 per month a difference of $16.67. The up front MI will stay the same at 2% for new purchase.</p><h1 style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; line-height: 19px;">USDA Refinance</h1><p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;"> </p><p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;">On USDA Refinances (which are currently out of funds until at least October 2012) will also incur an annual MI increase from .3% to .4%. The up front will increase from 1.5% to 2% to match the structure of new purchase.</p><p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;">The way the annual rate is calculated is to take the original loan amount and multiply it by .004 (this will give you the annual) then divide it by 12 which will give you the monthly cost. 200,000 x .004 = 800 / 12 = 66.66</p><p style="color: #333333; font-family: Georgia, 'Times New Roman', 'Bitstream Charter', Times, serif; font-size: 13px; line-height: 19px;">USDA Loans are still an extremely strong loan compared to FHA and Conventional and with no down payment requirement its a no brainer for most people who qualify.</p></p></p>