Quantcast

The reduction of the FHA mortgage insurance premium was announced for most FHA loans closed on or after January 27, 2017. The incoming Trump Administration suspended the change with its first executive action.

FHA Mortgage Loan Rates

January 23, 2020
FHA Rates for January 23, 2020
Compare 30 Year Fixed Mortgages
Compare 15 Year Fixed Mortgages
Use our mortgage calculators
to see what you can afford!
Get started one
Get started two
Get started three
Get started four
FHA.com is a privately owned website, is not a government agency, and does not make loans.

Choose a Loan Type

then
get
your

Your Credit Score

Do you know what's on
your credit report?
Get Credit Score Button
Get Credit Score Button
FHA.com is a privately owned website, is not a government agency, and does not make loans.

Obama's MIP Reduction for 2017 Reversed by Incoming Trump Administration

FHA Homeowners Can Still Save an Average of $900 Annually From the 2015 Reduction. Further Estimated Reduction of $500 Suspended.

FHA Mortgage Insurance Premiums (MIP)
FHA Mortgage Insurance Premiums (MIP)

On January 9, 2017, the Federal Housing Administration operating under the Obama administration announced a further reduction in the FHA loan annual mortgage insurance premiums (MIP) for new loans. The change would affect most Title II FHA mortgage loans with a closing/disbursement date on or after January 27, 2017. Excluded were loans made for properties in the Hawaiian Homelands.

These new MIP rates would have reduced the annual premiums by a quarter of one percentage point, bringing them in line with what rates were prior to pre-housing crisis levels of 2008. This is referred to by many as the "collapse of the housing market." Homebuyers financing their homes with an FHA government-backed loan could have saved an additional $500 per year based on an average $200,000 mortgage with a term of at least 11 years.

Less than two weeks later in the first hour of Trump's presidency, the incoming administration suspended the rate reduction with its first executive action. The suspension of the 0.25 percentage point premium rate cut happened before the reduction had even taken effect.

Since FHA loans have a minimum down payment rate set as low as 3.5 percent, it is compulsory that borrowers pay the MIP. When someone purchases a home with an FHA mortgage, part of their mortgage payment includes a required annual mortgage insurance premium (MIP). The amount of the annual MIP is based on the loan-to-value ratio, base loan amount, and the term of the mortgage.

Loans backed by FHA are popular because the FICO score requirement of 580 is lower than what is required for conventional mortgages and the down payment can be as low as 3.5%. Buyers must still demonstrate their ability to qualify for a mortgage and pay it back on time.

See also: Current Mortgage Insurance Premium (MIP) Rates

SEE YOUR CREDIT SCORES   From All 3 Bureaus  

Do you know what's on your credit report?

Learn what your score means.


GET STARTED

FHA Loan Articles and Mortgage News

There Are Different Kinds of One-Time Close Construction Loans

January 13, 2020 - A One-Time Close loan can help you build a home without the requirements some other construction loans have -- two applications, two loans, and two closing dates. These construction loans are for first-time home buyers AND experienced home owners alike.

FHA Home Loan Costs to Save for in 2020

January 12, 2020 - If you've already started saving for your down payment, your appraisal, compliance inspections, and other costs, you’re well ahead of the game. Those who haven’t started truly planning and saving may feel a bit lost when trying to get ready for the loan. 

FHA Home Loan Tips for Buying Multi-Unit Homes

January 10, 2020 - FHA loan rules include the ability for borrowers who intend to be owner-occupiers to buy multi-unit properties. For an FHA loan on a multi-unit home to be approved, the borrower must occupy at least one unit. FHA home loans are for primary residences only.

Applying for a One-Time Close Construction Loan in 2020

January 9, 2020 - FHA One-Time Close construction loans are intended to help those who want to own and occupy a home to build from the ground up on their own land. There is also a VA loan equivalent to the FHA construction loan that, starting in 2020, features no down payment.

FHA Loan Limits for 2020: Going Up in a Housing Market Near You?

January 7, 2020 - FHA loan guaranty limits are higher again in 2020. This comes after last year’s increase in loan limits and a fairly good year for mortgage interest rates. FHA loans have loan guaranty limits that help establish the maximum loan possible for a given market.