FAQ

FHA Mortgage Insurance: How Much Does It Cost? | LendingTree

fha loans are underwritten by the federal housing administration, a subsidiary of the u.s. department of housing and urban development (hud). Because FHA-approved lenders take on more risk due to lower credit scores and down payment requirements, borrowers are responsible for paying FHA mortgage insurance.

fha borrowers have to pay two types of mortgage insurance premiums: up front and annual. The Advance Mortgage Insurance Premium (UFMIP) is collected at the closing of your mortgage when you first take out your loan, while the Annual Premium is an ongoing obligation that you pay annually. These mortgage insurance premiums (MIPs) protect the lender in the event of a mortgage default. In many cases, you are responsible for fha mip for the life of your loan.

Reading: How do you calculate fha mortgage insurance

how much does fha mortgage insurance cost?

Advance mortgage insurance premium is 1.75% of your loan amount and is due at closing. If you’re borrowing $250,000, for example, your starting mip will be $4,375 ($250,000 x 1.75% = $4,375).

The 1.75% ufmip applies to most fha loans, regardless of loan amount or term, except for the following:

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