FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates
FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates. Full verbatim text, substring-verified against snapshot aadeeba515d4a11d.
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Verbatim provisions from FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates — Purpose
This Mortgagee Letter (ML) communicates revised annual MIP rates for FHA Title II forward mortgages.
FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates — Effective Date
The provisions of this ML are effective for case numbers endorsed on or after March 20, 2023. All updates will be incorporated into a forthcoming update of the HUD Handbook 4000.1, FHA Single Family Housing Policy Handbook (Handbook 4000.1).
FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates — Affected Programs
The provisions of this ML apply to all Title II forward mortgages except mortgages insured under Section 247 (Hawaiian Homelands) of the National Housing Act (NHA), which do not require annual MIP, and Streamline Refinance and Simple Refinance Mortgages used to refinance a previous FHA endorsed mortgage on or before May 31, 2009.
FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates — Background
FHA plays a critical role in providing access to homeownership for millions of Americans, particularly for first-time homebuyers and underserved communities. FHA periodically re-evaluates the appropriate level of MIP pricing based on the state of the Mutual Mortgage Insurance Fund (MMI Fund) and housing and economic conditions. FHA has determined that a reduction for certain programs to the annual MIP rate it charges pursuant to NHA Section 203(c)(2)(B) is necessary and appropriate to the execution of FHA’s mission and role in the mortgage market.
FHA Mortgagee Letter 2023-05 — Reduction of Federal Housing Administration (FHA) Annual Mortgage Insurance Premium (MIP) Rates — Summary of Changes
This ML: • reduces the annual MIP on Title II Single Family forward mortgages endorsed on or after March 20, 2023, with the exception of those programs noted; and • amends the Base Loan amount threshold used to establish MIP rates to the national conforming loan limit. FHA Single Family Housing Policy Handbook 4000.1 The policy changes will be incorporated into Handbook 4000.1 as follows: Appendix 1.0 – Mortgage Insurance Premiums (03/20/2023) Upfront Mortgage Insurance Premium (UFMIP) All Mortgages: 175 Basis Points (bps) (1.75%) of the Base Loan Amount. Exceptions: • Streamline Refinance and Simple Refinance Mortgages used to refinance a previous FHA-endorsed Mortgage on or before May 31, 2009 • Hawaiian Home Lands (Section 247) • Indian Lands (Section 248) Indian Lands (Section 248) do not require a UFMIP. Annual Mortgage Insurance Premium (MIP) Applies to all Mortgages except: • Streamline Refinance and Simple Refinance Mortgages used to refinance a previous FHA endorsed Mortgage on or before May 31, 2009 • Hawaiian Home Lands (Section 247) Hawaiian Home Lands (Section 247) do not require Annual MIP. Mortgage Term of More Than 15 Years Base Loan Amount LTV MIP (bps) Duration Less than or equal to $726,200 ≤ 90.00% 50 11 years > 90.00% but ≤ 95.00% 50 Mortgage term > 95.00% 55 Mortgage term Greater than $726,200 ≤ 90.00% 70 11 years > 90.00% but ≤ 95.00% 70 Mortgage term > 95.00% 75 Mortgage term Mortgage Term of Less than or Equal to 15 Years Base Loan Amount LTV MIP (bps) Duration Less than or equal to $726,200 ≤ 90.00% 15 11 years > 90.00% 40 Mortgage term Greater than $726,200 ≤ 78.00% 15 11 years > 78.00% but ≤ 90.00% 40 11 years > 90.00% 65 Mortgage term Streamline Refinance, Simple Refinance: For refinance of previous Mortgage endorsed on or before May 31, 2009 UFMIP: 1 (bps) (.01%) All Mortgages All Mortgage Terms Base Loan Amount LTV Annual MIP (bps) Duration All ≤ 90.00% 55 11 years > 90.00% 55 Mortgage term For Mortgages where FHA does not require an appraisal, the value from the previous Mortgage is used to calculate the LTV. Hawaiian Home Lands Section 247 Hawaiian Home Lands Upfront MIP (UFMIP) Loan Term in Years ≤18 >18 and ≤22 >22 and ≤25 >25 MIP Financed 2.400% 3.000% 3.600% 3.800% MIP not Financed 2.344% 2.913% 3.475% 3.661% Annual MIP is not assessed on Section 247 Mortgages.
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Source of record: https://claudeforcompliance.com/regs/hud-ml-2023-05/
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