FHA Requirements
Mortgage Insurance (MIP) for FHA Insured Loan
Mortgage insurance is a policy that protects lenders against losses that result from defaults on home mortgages. FHA requires both upfront and annual mortgage insurance for all borrowers, regardless of the amount of down payment.
2018 MIP Rates for FHA Loans Over 15 Years
If you take out a typical 30-year mortgage or anything greater than 15 years, your annual mortgage insurance premium will be as follows:
| Base Loan Amount | LTV | Annual MIP |
|---|---|---|
| ≤ $625,500 | ≤ 95% | 80 bps (0.80%) |
| ≤ $625,500 | > 95% | 85 bps (0.85%) |
| >$625,500 | ≤ 95% | 100 bps (1.00%) |
| > $625,500 | > 95% | 105 bps (1.05%) |
2018 MIP Rates for FHA Loans Up to 15 Years
Homebuyers who can afford to pay off their loans quicker and opt for a shorter term, such as a 15-year mortgage, will benefit from lower mortgage insurance premiums, as follows:
| Base Loan Amount | LTV | Annual MIP |
|---|---|---|
| ≤ $625,500 | ≤ 90% | 45 bps (0.45%) |
| ≤ $625,500 | > 90% | 70 bps (0.70%) |
| > $625,500 | ≤ 78% | 45 bps (0.45%) |
| > $625,500 | 78.01% to 90% | 70 bps (0.70%) |
| > $625,500 | > 90% | 95 bps (0.95%) |
How Long Will You Pay the MIP?
For loans with FHA case numbers assigned on or after June 3, 2013, FHA will collect the annual MIP, which is the time at which you will pay for FHA Mortgage Insurance Premiums on your FHA loan. They are as follows:
| Term | LTV% | Previous | New |
|---|---|---|---|
| ≤ 15 years | ≤ 78% | no annual MIP | 11 years |
| ≤ 15 years | 78.01% to 90% | cancelled at 78% LTV | 11 years |
| ≤ 15 years | > 90% | loan term | loan term |
| > 15 years | ≤ 78% | 5 years | 11 years |
| > 15 years | 78.01% to 90% | cancelled at 78% LTV and 5 years | 11 years |
| > 15 years | > 90% | cancelled at 78% LTV and 5 years | loan term |
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:
- 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.
- 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).
- 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:
- 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).
- 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).
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FHA Loan Articles and Mortgage News
February 3, 2019 - Should a borrower applying for a first-time home loan consider an FHA adjustable rate mortgage loan? Is it possible to save money with a new home loan that doesn’t have a fixed interest rate? FHA home loans are great choices for first-time home buyers, but the options may seem confusing at first.
February 2, 2019 - Why should a first-time home buyer get pre-qualified for an FHA mortgage? There are a variety of reasons to consider, but one of the most important is being able to see how much home you can afford and how much loan a lender is willing to offer you based on your credit score and history.
February 1, 2019 - A short sale may be used by home owners as a method to avoid foreclosure. Regardless of the motivation for the short sale, under certain circumstances there is a mandatory three-year FHA-required waiting period.
January 30, 2019 - Looking for a first home but worried about your credit scores? FHA loans feature lower credit requirements but it’s easy to forget that FICO scores are not the only criteria used to judge your ability to afford a first home loan.
January 28, 2019 - There are five basic areas you should prepare in before filling out paperwork to apply for an FHA home loan. If you haven’t taken these steps, it is best to do so before you submit your application to the lender.
FHA.com Reviews
FHA.com is a one-stop resource for homebuyers who want to make the best decisions when it comes to their mortgage. With our detailed, mobile-friendly site, individuals can access information about different FHA products, the latest loan limits, and numerous other resources to make their homebuying experience easier. Take a look at some of the reviews from other FHA.com visitors!
