FHA Mortgage Will Cost More

FHA annual mortgage insurance premiums will match those of private mortgage insurance companies starting today for all new FHA loans. The annual premium will rise from 0.55 percent to 0.9 percent, which is the same as most private mortgage insurance for loans between 95 percent and 97 percent down.

The good news is that the premium you must pay up front is dropping from 2.25 percent to just 1 percent. Even if you don't pay that premium up front, which is true for most people who take advantage of FHA's low-down-payment option of just 3.5 percent, you will save money each month because your mortgage principal will be lower with the lower up-front fee.

But just how much more will you have to pay monthly?