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Cancellation of Annual MIP & Increase to Annual MIP

February 6, 2013

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HUD announces that effective with case numbers assigned on and
after April 1, 2013 (except as noted below) it will be:

  • Revising the period for assessing the annual MIP;
  • Removing the exemption from annual MIP for loans with terms of 15 years or less and LTV of 78% or lower; and
  • Increasing the annual MIP on all forward mortgages except single family refinance transactions that refinance FHA loans endorsed on or before May 31,2009 (see ML 2012-04)

For loans with case numbers assigned on or after June 3, 2013, FHA will collect the annual MIP:

  • For all mortgages regardless of their terms, with an LTV of 90% or less, the annual MIP will be assessed until the end of the mortgage term or for the first 11 years of the mortgage term, whichever occurs first.
  • For any mortgage with an LTV greater than 90%, FHA will assess the annual MIP until the end of the mortgage term or for the first 30 years of the term, whichever occurs first.

FHA Calculates LTV as a percentage by dividing the base loan amount (prior to
financed UFMIP) by the lesser of the purchase price or appraised value. For streamline refinance loans without appraisal, FHA uses the original appraised value of the property.

FOR A FAST PRE-APPROVAL: Complete a loan application on our websitehttp://pmccanhelp.com/mortgage_application.php

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