Changes to FHA Mortgage Insurance Premium (MIP) take effect today

For the second time this year, FHA is changing their mortgage insurance premium (MIP). FHA does not make loans directly, rather FHA guarantees mortgages made by approved lenders. The FHA MIP is mortgage insurance for FHA loans that protects the lender in case of borrower default on the loan.

FHA charges two types of MIP
(1) Up-Front MIP (UFMIP) which is paid at closing and added to the base loan amount and
(2) Annual MIP (AMIP) which is collected each month with the regular mortgage payment.




So, for a $200,000 FHA mortgage with a term of 30 years and an LTV greater than 95% the UFMIP would be $2,000 instead of $4,500 and the AMIP would be $1,800 instead of $1,100 (or, $150/month instead of $91.67/month)