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.
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 |
|---|---|---|
| ≤ $726,200 | ≤ 90% | 50 bps (0.50%) |
| ≤ $726,200 | > 90% but ≤ 95% | 50 bps (0.55%) |
| ≤ $726,200 | > 95% | 55 bps (0.55%) |
| > $726,200 | ≤ 90% | 70 bps (0.70%) |
| > $726,200 | > 90% but ≤ 95% | 70 bps (.70%) |
| > $726,200 | > 95% | 75 bps (.75%) |
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 |
|---|---|---|
| ≤ $726,200 | ≤ 90% | 15 bps (0.15%) |
| ≤ $726,200 | > 90% | 40 bps (0.40%) |
| > $726,200 | ≤ 78% | 15 bps (0.15%) |
| > $726,200 | > 78% but ≤ 90% | 40 bps (0.40%) |
| > $726,200 | > 90% | 65 bps (0.65%) |
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% | Duration |
|---|---|---|
| ≤ 15 years | ≤ 78% | 11 years |
| ≤ 15 years | > 78% but ≤ 90% | 11 years |
| ≤ 15 years | > 90% | Mortgage Term |
| > 15 years | ≤ 78% | 11 years |
| > 15 years | > 78% but ≤ 90% | 11 years |
| > 15 years | > 90% | Mortgage 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 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.
Current Annual MIP Premium other than Certain Streamline FHA Refinances *Revision to the Annual MIP Premium – as per Mortgagee Letter 2023-05
This Mortgagee Letter reduces the Annual Mortgage Insurance Premiums as well as amending the base loan amount threshold of $726,200 for all case numbers assigned on or after March 20th, 2023 for the following:
MORTGAGE TERMS OF MORE THAN 15 YEARS
- On loan amounts less than or equal to $726,200 with a Loan to Value of less than or equal to 90% and with a term more than 15 years. The annual MIP for these loans will be reduced to 50 basis points.
- On loan amounts less than or equal to $726,200 with a Loan to Value of greater than 90%, but less than or equal to 95% and with a term more than 15 years. The annual MIP for these loans will be reduced to 50 basis points.
- On loan amounts less than or equal to $726,200 with a Loan to Value of greater than 95%, and with a term more than 15 years. The annual MIP for these loans will be reduced to 55 basis points.
- On loan amounts greater than $726,200 with a Loan to Value of less than or equal to 90% and with a term more than 15 years. The annual MIP for these loans will be reduced to 70 basis points.
- On loan amounts greater than $726,200 with a Loan to Value of greater than 90%, but less than or equal to 95% and with a term more than 15 years. The annual MIP for these loans will be reduced to 70 basis points.
- On loan amounts greater than $726,200 with a Loan to Value of greater than 95%, and with a term more than 15 years. The annual MIP for these loans will be reduced to 75 basis points.
MORTGAGE TERMS OF LESS THAN OR EQUAL TO 15 YEARS
- On loan amounts less than or equal to $726,200 with a Loan to Value of less than or equal to 90% and with a term less than or equal to 15 years. The annual MIP for these loans will be reduced to 15 basis points.
- On loan amounts less than or equal to $726,200 with a Loan to Value greater than 90% and with a term less than or equal to 15 years. The annual MIP for these loans will be reduced to 40 basis points.
- On loan amounts greater than $726,200 with a Loan to Value of less than or equal to 78% and with a term less than or equal to 15 years. The annual MIP for these loans will be reduced to 15 basis points.
- On loan amounts greater than $726,200 with a Loan to Value of greater than 78% , but less than or equal to 90% and with a term less than or equal to 15 years. The annual MIP for these loans will be reduced to 40 basis points.
- On loan amounts greater than $726,200 with a Loan to Value of greater than 90%, and with a term less than or equal to 15 years. The annual MIP for these loans will be reduced to 65 basis points.
FHA Loan Requirements
SEE YOUR CREDIT SCORES From All 3 Bureaus
Do you know what's on your credit report?
Learn what your score means.
FHA Loan Articles and Mortgage News
April 2, 2024 - There are lots of finance and mortgage-related publications. Some of these discuss FHA loan guidelines with varying degrees of accuracy. Here are some facts--and corrections--about FHA loans as published by others.
April 1, 2024 - When did you last check into your options to buy, build, or refinance using an FHA mortgage? In recent years, the FHA and HUD have modified the FHA single-family home loan program in ways that have benefited borrowers, both new house hunters and experienced borrowers.
April 1, 2024 - The FHA’s new program launched in 2024 is called the FHA Payment Supplement and allows participating lenders more freedom to (temporarily) change the terms of the loan to reduce monthly payments without changing the home loan interest rate.
March 30, 2024 - As the first quarter of 2024 ends, some market watchers are revising their home loan interest rate predictions for the remainder of the year. There are multiple reasons why mortgage loan interest rates may fall slower than some might like. One of those reasons? Fed lending policy.
March 28, 2024 - What home loan terms are important for first-time home buyers to know? The answers may surprise you. We aren’t talking about the basic definitions of escrow or loan limits. Instead, we are reviewing mortgage loan terms that are similar to others.
