FHA Mortgage Insurance Premium On 15 Versus 30 Year FHA Loans

FHA Mortgage Insurance Premium On 15 Versus 30 Year FHA Loans

This BLOG On FHA Mortgage Insurance Premium On 15 Versus 30 Year FHA Loans Was UPDATED On February 1st, 2019

FHA insured mortgage loans are a great program for first time home buyers and for those who need a home loan with bad credit.

  • FHA insured mortgage loans make first time home buyers
  • FHA Loans are perfect for those who need home loan with bad credit to realize the dream of home ownership a reality
  • To qualify for a 3.5% down payment FHA insured mortgage loan for first time home buyers
  • FHA Loans are ideal for home buyers seeking a home loan with bad credit
  • Minimum credit score required is 580
  • The Federal Housing Administration makes home ownership possible for those with the following:
    • have had prior bankruptcies
    • foreclosures
    • deed in lieu of foreclosures
    • short sales
    • those who have had credit issues and still have unsatisfied collection and charge off accounts
    • borrowers can qualify for a mortgage loan approval with outstanding collection accounts, charge offs, and prior bad credit
    • as long as borrowers have been timely for the past 12 months on monthly credit obligations they should get an approve/eligible per Automated Underwriting System Findings

FHA Mortgage Insurance Premium: 30 Year Fixed Rate FHA Loans

Home Buyers seeking a FHA insured mortgage loan, a 3.5% down payment is required towards home purchase.

  • Borrowers will also be charged a 1.75% upfront FHA MIP which can be rolled into the mortgage loan balance
  • For 30 years fixed rate FHA loans, there is also a 0.85% annual MIP
  • This is paid monthly along with mortgage payment
  • The annual mortgage insurance premium is 0.85% of mortgage balance
  • Borrowers need to pay this mortgage insurance premium for the life of the FHA loan
  • The only way Borrowers get out of paying the monthly FHA mortgage insurance premium is when they pay off mortgage 

Mortgage Insurance Premium: 15 Year Fixed Rate FHA Loans

The Federal Housing Administration has a special mortgage insurance premium reduction program. Home Buyers who put a 10% down payment on a 15 year fixed rate FHA loan, Mortgage insurance premium will greatly be reduced from the standard 0.85% of mortgage balance amount to 0.45% of mortgage balance amount.

  • This reduction of mortgage insurance premium is a huge savings over the course of the loan
  • Also, another perk with a FHA 15 year fixed rate mortgage loan is that you can cancel the FHA mortgage insurance premium on the 11th year if and only if your FHA loan to value is at 78% or lower

Borrowers who need to qualify for mortgage with a national direct lender with no mortgage overlays, please contact Gustan Cho Associates at 262-716-8151 or text us. Or email us at gcho@gustancho.com. We are available 7 days a week, evenings, weekends, and holidays. Gustan Cho Associates Mortgage Group has zero overlays on government and conventional loans.

By Gustan Cho


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