Despite popular belief, The FHA agency is not a mortgage lender. It’s merely a mortgage insurer. The FHA agency insures loans that meet its guidelines, which are the minimum standards the FHA requires on its loans. However, unlike auto insurance or hazard insurance, where insurance premiums benefit the payer (i.e. you), FHA mortgage insurance premiums (MIP) benefit your lender instead. In the event you default, your lender gets paid.
How Much Would My MIP Be For An FHA Loan?
The FHA uses a standard formula to determine the cost of mortgage insurance premium. This formula is based on a few things among other things, the amount of the loan, the amount of the down payment and the number of years the mortgage lasts. The easiest way to estimate your monthly MIP is to use an online calculator and you will need to have the following information:
- Property Purchase price
- Down Payment Amount
- Interest Rate
- Loan Term
- State | Location (Florida)
Can I Cancel My FHA Mortgage Insurance Premium?
FHA MIP costs dropped in early-2015, but they can still be somewhat costly. You may not want to pay them forever. If you’re tired of paying FHA MIP, you might be happy to learn you can cancel it. Call us and learn how to rid yourself of it. The solution may be simpler than you think