FHA requirements include mortgage insurance for FHA loans in 2024 to protect lenders against losses that result from defaults on home mortgages. Mortgage insurance premiums are required when down payments are less than 20% of the appraised value.

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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 AmountLTVAnnual 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 AmountLTVAnnual 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:

TermLTV%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

  1. 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.
  2. 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.
  3. 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.
  4. 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.
  5. 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.
  6. 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

  1. 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.
  2. 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.
  3. 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.
  4. 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.
  5. 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

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