FHA New Risk MI Premiums

As of October 4th 2010, the new UFMIP – Up Front Mortgage Insurance Premiums will now be 1% of the financed loan amount for an FHA insured mortgage loan.

Annual Premium

The Annual Mortgage Insurance Premium will now be .90% for a down payment of 5% or less and .85% for more than 5% down payment on 30 year term. On a 15 year mortgage, the Annual Mortgage Insurance Premium will be .25% for less than 10% down payment and with a down payment of 10% or more there will not be any Annual Mortgage Insurance Premium.

FHA Single Family Mortgage Insurance
Upfront and Annual Mortgage Insurance Premiums
Loan Terms > 15 Years
All premiums are specified in basis points (0.01%)

FHA will charge an upfront premium in an amount equal to the following percentages of the mortgage:

• Purchase Money Mortgages and Full-Credit Qualifying Refinances = 1 %
  
• Streamline Refinances (all types) = 1 %
  

If a FICO score is available, it must be used to determine the decision FICO score for the application, and the FHA premium to be charged. A “decision FICO score” is determined for each applicant according to the following rule: when three FICO scores are available (one from each credit repository), the median (middle) score is used; when only two scores are available, then the lesser of the two is chosen; when only one score is available, then the middle is used.

For Multiple Borrowers – if more than one individual is applying for the same FHA mortgage, the FHA lender must determine the decision FICO score for each individual borrower, and then select the lower (or lowest if more than two borrowers). That “decision FICO score” is then used to determine the appropriate FHA insurance premium in conjunction with the loan to value ratio.

For Multiple Borrowers/One Without a FICO Score – the borrower representing the greatest risk to the Department will determine the premium charged. For example, if the decision FICO score for one borrower is between 559-500, and the other borrower is in the non-traditional (No Score) credit category, the decision FICO score between 559-500 is used to determine the FHA premium. However, if the decision FICO score for one borrower is between 639-600, and the other borrower is in the non-traditional credit category, the non-traditional credit category is used to determine the FHA premium. FHA NC mortgage rates will be subject to your FICO score.