FHA requirements include mortgage insurance for FHA loans to protect lenders against losses that result from defaults on home mortgages.

FHA Loan Rates

May 27, 2015
FHA Rates for May 27, 2015
30 Year Fixed
3.5% Rate
3.74% APR
15 Year Fixed
2.75% Rate
3.0% APR
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FHA Requirements

Mortgage Insurance for FHA Insured Loan

Mortgage insurance is a policy that protects lenders against losses that result from defaults on home mortgages. FHA requirements include mortgage insurance primarily for borrowers making a down payment of less than 20 percent.

Current Up-Front Mortgage Insurance Premium

The UPMIP is currently at 1.75% of the base loan amount. This applies regardless of the amortization term or LTV ratio.

Current Up-Front MIP on Certain Streamline FHA Refinances

SF forward streamline refinance transactions that are refinancing FHA loans endorsed on or before May 31, 2009, the UFMIP is currently 0.01 percent of the base loan amount.

Current Annual MIP on Certain Streamline FHA Refinances

SF forward streamline refinance transactions that are refinancing FHA loans endorsed on or before May 31, 2009, the Annual MIP will be 55 bps, regardless of the base loan amount and takes effect on or after June 11th, 2012.

*Revision to the Annual MIP Premium – as per Mortgagee Letter 2015-01

There will be no change in Annual Mortgage Insurance Premiums for all case numbers assigned on or after January 26th, 2015 for the following:

  1. On loans with a Loan to Value of less than or equal to 78% and with terms up to 15 years. The annual MIP for these loans will remain at 45 basis points.
  2. On terms <= 15 years and loan amounts <=$625,500 - If the loan to value is <= 90%, the Annual Premium remains the same at 45 basis points (bps). If the loan to value is >90%, the Annual Premium remains the same at 70 basis points (bps).
  3. On terms <= 15 years and loan amounts >$625,500 - If the loan to value is 78.01% - 90.00%, the Annual Premium remains the same at 70 basis points (bps). If the loan to value is >90%, the Annual Premium remains the same at 95 basis points (bps).

There will be the following reduction in premiums in Annual Mortgage Insurance Premiums for all case numbers assigned on or after January 26th, 2015 for the following:

  1. On terms > 15 years and loan amounts <=$625,500 - If the loan to value is <= 95%, the new Annual Premium is reduced from 130 basis points (bps) to 80 basis points (bps). If the loan to value is >95%, the new Annual Premium is reduced from 135 basis points (bps) to 85 basis points (bps).
  2. On terms > 15 years and loan amounts >$625,500 - If the loan to value is <= 95%, the new Annual Premium is reduced from 150 basis points (bps) to 100 basis points (bps). If the loan to value is >95%, the new Annual Premium is reduced from 155 basis points (bps) to 105 basis points (bps).
Term > 15 Years
Base Loan Amount
LTV
Effective
Annual MIP
< = $625,500
< = 95.00%
26-Jan-15
80 bps
< = $625,500
>95.00%
26-Jan-15
85 bps
Above $625,500
< = 95.00%
26-Jan-15
100 bps
Above $625,500
>95.00%
26-Jan-15
105 bps
Term < = 15 Years With LTV Above 78%
Base Loan Amount
LTV
Effective
No Changes to Annual MIP
Any Loan Amount
< =78.00%
3-June-13
45 bps
< = $625,500
< =90.00%
1-April-13
45 bps
< = $625,500
>90.00%
1-April-13
70 bps
Above $625,500
< = 90.00%
1-April-13
70 bps
Above $625,500
>90.00%
1-April-13
95 bps

*No Revision to the time period for Assessing Annual MIP

For loans with FHA case numbers assigned on or after June 3, 2013, FHA will collect the annual MIP, which is the time on which you will pay for FHA Mortgage Insurance Premiums on your FHA loan. They are as follows:

Term
LTV %
Previous
New
< = 15 yrs
< = 78
No Annual MIP
11 years
< = 15 yrs
> 78 - 90.00
Cancelled at 78% LTV
11 years
< = 15 yrs
> 90.00
Cancelled at 78% LTV
Loan Term
> 15 yrs
< = 78
5 years
11 years
> 15 yrs
>= 78 - 90.00
Cancelled at 78% LTV & 5 yrs
11 years
> 15 yrs
> 90.00
Cancelled at 78% LTV & 5 yrs
Loan Term

FHA Loan Articles

Read About Mortgage News, FHA Updates, and Guidelines
Appraisals and the Crawl Space

Appraisals are an important part of the FHA loan process, and we get plenty of questions about what may or may not be acceptable in the appraisal. For some, depending on the age and design of the home, crawlspaces can be a worry.

Rules on Personal Property Included With a Home Sale

There are situations where a buyer wants to purchases a home with an FHA loan and the seller will try to sweeten the deal by offering to include personal property such as appliances, vehicles, or other items. Including such things would require the lender to deduct the value of all the included items from the loan amount.

MIP Reduction and Cancelled FHA Loan Case Numbers

The answer to this question is fairly simple. Any FHA borrower with a forward mortgage longer than 15 years (excluding the exceptions mentioned above) who has an FHA loan case number assigned on or after January 26, 2015 is eligible for the new, lower annual MIP.

FHA Reduces Annual Mortgage Insurance Premiums

FHA made an announcement about cuts in the annual mortgage insurance premium (MIP) in a preliminary January 2015 announcment. The new FHA policy reduces the rate for most Title II forward mortgages with terms greater than 15 years.

Private Mortgage Insurance Requirements

One common question we get involves Private Mortgage Insurance and the premiums for that insurance. Borrowers should discuss PMI policy changes with a loan officer.