FHA mortgage, Mortgage Insurance Premium?
I am getting an FHA loan in California and the lender is telling me that the government will charge me a total of 2.25% upfront for the MIP or Mortgage Insurance Premium, many people have posted that it is 1.5%, does it vary from state to another or is the Lender just making extra money off of me ?
I would appreciate an answer from a knowledgeable loan officer or someone in that business.
- 9 years agoBest Answer
The 1st answer has mortgage insurance and mortgage insurance premium confused. It is 2.25%. You will have to pay it for your FHA loan but You have the option to finance it. Most people do.
Even after you eighter pay or finance this amount, you will still need to pay your monthly PMI(mortgage insurance)Source(s): Realtor
- Anonymous9 years ago
The current upfront mortgage insurance premium is 2.25% so you lender is telling you the truth. Just a heads up, as of October 4th 2010 that premium will be reduced to 1% but the monthly mortgage insurance will go from .55 to .90 so you will want to look at the difference in the payments and decide which way you want to go.
If it turns out that the current premium and monthly mortgage insurance works better for you, you'll need to make sure that your lender pulls your FHA case number before October 4th.Source(s): I'm a mortgage banker/broker http://www.fhamortgagesdoneright.com
- Simpson G.Lv 79 years ago
All programs but the 15 year loan are subject to .25% to .55% annual premium paid monthly for a mandatory minimum of 5 years. After 5 years, if the LTV is less than 78%, the monthly premiums will no longer apply.
If you are paying this upfront and will not have it tacked on monthly, it could be a fair percentage. Ask your lender directly why it's being worked out the way that it is. It's ok to not understand and to have them explain it until you do understand. Don't be afraid of questioning things - it is >your< money afterall.
- liveinmdLv 59 years ago
Just some additional info- the lender can't make extra money this way; the MIP is remitted directly to the governmentSource(s): Mortgage
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- kroesenLv 43 years ago
while you're putting 20% down, very own loan assurance isn't required, yet it relies upon on the state. in case you have been required to pay for assurance, funds is the WORST thank you to pay. there have been situations of people figuring out to purchase assurance, thinking they have been coated, while it grew to become out that an worker saved the money and no checklist existed of fee. Paying with the help of verify (or electronically) is lots extra desirable, because of the fact it leaves a path.