What is PMI or Primary Mortgage Insurance? Do I need it and can I get a mortgage without it? Bert Sanderfur answers your questions in our latest Youtube video!
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. This information is reflective as of 1-1-17 and is subject to change per regulatory guidnace from The Department of Housing and Urban Development (HUD).
As of January 1, 2017 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%) |
As of January 1, 2017 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% | Term of MIP | |
|---|---|---|---|
| ≤ 15 years | ≤ 78% | 11 years | |
| ≤ 15 years | 78.01% to 90% | 11 years | |
| ≤ 15 years | > 90% | loan term | |
| > 15 years | ≤ 78% | 11 years | |
| > 15 years | 78.01% to 90% | 11 years | |
| > 15 years | > 90% | 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
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
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.