MIP Reduction
Lower mortgage insurance premiums (MIP) can mean more money in your pocket.
Whether you’re refinancing, purchasing your first home, or buying your next home, we can help you take advantage of the newly lowered, mandatory monthly mortgage insurance premiums (MIP). The good news is the Federal Housing Administration recently dropped the cost from an average of 1.35 to 0.85.
Looking to purchase your first home?
For the first-time homebuyer, this MIP decrease translates to a $900 reduction in annual mortgage payments on average. It also increases your purchasing power by about $18K. U.S. Mortgage Funding will ensure you get the most value out of your new FHA home loan.
Recently closed on a FHA Loan?
You can benefit, too. If you closed your loan on June 3, 2013 or after and currently have a 30-year mortgage, you can refinance and lower your MIP. Who doesn’t want lower monthly payments? When you refinance with U.S. Mortgage Funding, you can get a new, lower rate mortgage with better terms, and reduce your monthly payments.
How long does MIP last?
The lifespan of your FHA MIP reduction depends on a variety of factors, including when you applied for an FHA loan, the loan terms (15-year, 30-year, etc.), and whether you put down more or less than 10%-20% when closing. Generally, if you put less than 10% down, the MIP duration will last the full length of your home loan. If you put more than 10% down, your MIP reduction could last 11 years, though some extensions may apply. The chart below will help you figure out how long your MIP Reduction could last.
I applied for FHA loans prior to June 3, 2013:
| Your Original Loan Term |
Your Original Down Payment |
Your MIP Duration |
|---|---|---|
| 20, 25, 30 years | Less than 10% | 78% LTV based on original purchase price (5 years minimum) |
| 20, 25, 30 years | 10% to less than 20% | 78% LTV based on original purchase price (5 years minimum) |
| 20, 25, 30 years | 20% or more | 5 years |
| 15 years | Less than 10% | 78% LTV |
| 15 years | 10% to less than 20% | 78% LTV |
| 15 years | 20% or more | No MIP |
I applied for FHA loans on or after June 3, 2013:
| Your Original Loan Term |
Your Original Down Payment |
Your MIP Duration |
|---|---|---|
| 20, 25, 30 years | Less than 10% | Life of loan |
| 20, 25, 30 years | 10% to less than 20%, or 20%+ | 11 years |
| 15 years or less | Less than 10% | Life of loan |
| 15 years or less | 10% to less than 20%, or 20%+ | 11 years |
Are you eligible for an MIP Cancellation?
We can explain how you might benefit from the recent MIP reductions, and act as an experienced guide through every step of the loan process.
Contact U.S. today at 1-312-448-8763 or via our contact page for more information.