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Buying a home with an FHA mortgage requires you to make a down payment, pay closing costs, and ultimately accept the keys and move into your new home. And once that step is done, your first monthly mortgage payment is on the way. 

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FHA.com is a privately owned website, is not a government agency, and does not make loans.

Understanding Your FHA Home Loan Mortgage Payment

November 22, 2022

Understanding Your FHA Home Loan Mortgage Payment
Buying a home with an FHA mortgage requires you to make a down payment, pay closing costs, and ultimately accept the keys and move into your new home.

And once that step is done, your first monthly mortgage payment is on the way. But what does that mortgage payment consist of and why should you care?

The Consumer Financial Protection Bureau reminds consumers that a mortgage payment is not just your principal balance, plus interest. There are multiple things that go into your monthly payment.

They include any required insurance, taxes, escrow, etc. You may or may not also be responsible for homeowner’s association fees which aren’t technically part of what you owe your lender but play an important part of your home expenses nevertheless.

Your mortgage statement will include some specific information you should pay attention to--sometimes lenders make mistakes that show up in your monthly statement and if you see sudden changes in the statement in a given month, don’t let it go--contact the lender to see what’s going on.

Your monthly mortgage statement should include:
 
  • The total amount due
  • The monthly due date for payment
  • The interest rate of your mortgage
  • Any fees and charges
  • Details regarding past due payment where applicable, plus late fees. You may also see information on how much you need to pay to bring your account current (where applicable) if you fall behind on the FHA loan for more than 45 days.
It’s best to set up an automatic payment from your bank account for the loan amount, but not all borrowers may be inclined to do so, especially if you have an adjustable rate mortgage and are close to a rate adjustment period. 

Others may feel uncomfortable about a “set-and-forget” option specifically because they worry about lender errors or other factors.

And if you decide to refinance your home loan, there are other steps to take, but some of them are not necessary because of the nature of FHA mortgages. 

The Consumer Financial Protection Bureau advises borrowers to review their statements for early penalty payoff information--if you must pay a penalty to pay off your conventional loan early through refinance, you will want to know how much that fee is in advance.

But those who are refinancing FHA mortgages to another FHA loan do NOT have to worry about this because FHA loans prohibit early payoff penalties. That’s one important advantage when refinancing an existing FHA mortgage.

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