FHA Mortgage Insurance Premium (MIP)
Edited by Michael Jensen
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FHA Mortgage Insurance Premium (MIP) Fees
- The FHA mortgage program requires that borrowers pay an up-front and ongoing annual Mortgage Insurance Premium (MIP). The annual Mortgage Insurance Premium (MIP) is paid by the borrower on a monthly basis along with the monthly mortgage payment. The MIP protects lenders against losses that result from defaults on FHA mortgages
- The MIP is similar to and is an additional cost to the borrower on top of the monthly mortgage paymentInsurance against loss from mortgage default provided to the lender by a private insurance company. Depending on loan type and loan-to-value (LTV) ratio, the borrower may be required to pay PMI. PMI is typically required when the LTV ratio exceeds 80%. PMI typically requires that the borrower pay an ongoing annual fee, paid monthlyprivate mortgage insurance (PMI)
- The amount of mortgage insurance premium depends on mortgage amount, loan-to-value (LTV) ratio and mortgage term
- The LTV ratio equals the amount of your mortgage divided by the value of the property that you are buying
- As the MIP fee tables below indicate, the shorter the mortgage term and lower the LTV ratio, the lower the MIP fee
- The duration (how many years you have to pay) of the annual ongoing MIP varries by LTV ratio at the time you obtain the mortgage
- The tables below show MIP rates for home purchases and the duration of the annual ongoing MIP
- Use our FHA Mortgage Qualification Calculator to calculate the up-front and ongoing MIP fee for any FHA mortgage
Loan term of greater than 15 years
| Base Loan Amount | LTV Ratio | Up-Front MIP | Annual Ongoing MIP |
| Less than or equal to $625,000 | Less than or equal to 95.00% | 1.75% of loan amount | .80% of loan amount |
| Less than or equal to $625,000 | Greater than 95.00% | 1.75% of loan amount | .85% of loan amount |
| Greater than $625,000 | Less than or equal to 95.00% | 1.75% of loan amount | 1.0% of loan amount |
| Greater than $625,000 | Greater than 95.00% | 1.75% of loan amount | 1.05% of loan amount |
Loan term of less than or equal to 15 years
| Base Loan Amount | LTV Ratio | Up-Front MIP | Annual Ongoing MIP |
| Any loan amount | Less than or equal to 78% | 1.75% of loan amount | .45% of loan amount |
| Less than or equal to $625,000 | Less than or equal to 90.00% and greater than or equal to 78.00% |
1.75% of loan amount | .45% of loan amount |
| Less than or equal to $625,000 | Greater than 90.00% | 1.75% of loan amount | .70% of loan amount |
| Greater than $625,000 | Less than or equal to 90.00% and greater than or equal to 78.00% |
1.75% of loan amount | .70% of loan amount |
| Greater than $625,000 | Greater than 90.00% | 1.75% of loan amount | .95% of loan amount |
Annual Ongoing MIP duration
| LTV Ratio | Mortgage Term | Duration of Annual Ongoing MIP |
| Less than or equal to 90.00% | Any term | 11 years |
| Greater than 90.00% | Any term | Mortgage term |
Please note that the up-front and ongoing FHA MIP for multi-family properties (two-four units) designated as broadly affordable, mixed-income or energy-efficient is lower than the standard MIP outlined in the above tables. The FHA uses the following definitions for broadly affordable, mixed-income and energy-efficient:- Broadly Affordable: properties with at least 90% of the units under Section 8 contract and/or covered by Low Income Housing Tax Credit (LIHTC) affordability requirements
- Mixed-Income: properties that set-aside units based on affordability including partial LIHTC, partial section 8, inclusionary zoning or other local affordability requirement
- Energy-Efficient: properties committed to industry-recognized green building standards and committed to energy performance in the top 25% of multi-family buildings nationwide. Qualification for the top 25% is determined using the Environmental Protection Agency's (EPA’s) portfolio manager 1-100 score
- Both the up-front and ongoing MIP for broadly affordable and energy-efficient multi-family properties is .25% of the loan amount and .35% of the loan amount for mixed-income multi-family properties
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