FHA Single Family Mortgage Insurance Upfront Mortgage Insurance Premiums
Effective as of January 1, 2008
[All Premiums are specified in basis points (0.01%)]
| | Minimum Downpayment (%) (a) | FICO
850 -680 | FICO 679 - 640 | FICO 639 - 600 | FICO
599 -
560 | FICO
559 -
500 | FICO
499 -
300 | FICO None |
| Funds From Borrower or a Relative | 10 | 75 | 100 | 125 | 150 | 175 | 175 | 200 |
| Funds From Borrower or a Relative | 5 | 100 | 125 | 150 | 175 | 200 | ……….. | 225 |
| Funds From Borrower or a Relative | 3 | 125 | 150 | 175 | 200 | 225 | …………. | …………. |
| Other Sources of Funds | 3 | 175 | 200 | 225 (b) | …………. | …………. | …………. | …………. |
a. Premiums are based on two categories of sources of funds: (1) The borrower’s own funds or gifts from relatives and (2) any other acceptable source. See HUD Handbook 4155.1 for guidance on acceptable sources of funds.
b. A minimum decision credit score of 620 is required when downpayment funds come from a source other than the borrower or a relative of the borrower.
Notes:
1. Annual premium rates are: 50 basis points for loans with 5 and 10 percent downpayments; 55 basis points for loans with 3 percent downpayments; and 25 basis points for all loans with amortization terms of 15 years or less.
2. Downpayment percentage is determined by the base loan-to-value ratio (LTV). The ‘‘base LTV’’ is calculated by: (1) Dividing the base mortgage amount by the lesser of the sales price or appraised value of the property (for refinances, the base mortgage is divided by the appraised value of the property); (2) subtracting the result from 1 (one); and (3) multiplying by 100. ‘‘Base mortgage amount’’ is defined as the mortgage amount prior to adding any financed closing costs or upfront mortgage insurance.
3. Eligibility for the mortgage insurance premiums listed in the chart above is based on an applicant’s decision credit score (FICO). A ‘‘decision credit score’’ is determined for each applicant according to the following guidelines: when three scores are available (one from each repository), the median (middle) value is used; when only two are available, the lesser of the two is chosen; when only one is available, then that score is used. If more than one individual is applying for the same mortgage, the lender should determine the decision credit score for each individual borrower and then average them to determine the final decision credit score for the application. That application ‘‘decision’’ credit score is then used to underwrite and determine if the mortgage is considered an acceptable risk.
4. Except as provided below, eligibility for these insurance premiums is dependent upon borrower acceptance by TOTAL (Technology Open to Approved Lenders). Therefore, all borrowers with valid credit scores must be scored by TOTAL.
5. Borrowers not scored by TOTAL or with insufficient trade lines to generate credit bureau scores are considered as ‘‘none’’ in the premium chart and are priced accordingly. Borrowers falling into cells with no premium price shown are not eligible for FHA-insured financing.
6. If TOTAL refers a loan for manual underwriting and the underwriter deems that there are sufficient compensating factors to create an acceptable risk to FHA, then the upfront insurance premium charge will be as shown on the premium chart.
7. These premiums apply to all purchase loans and to fully underwritten (non-streamline) refinance loans. Cash-out refinance loans must meet a minimum 5 percent equity requirement, based on the appraised value of the property.
8. Streamline refinance of an existing FHA loan for which a case number was assigned prior to January 1, 2008, will have an upfront premium of 100 basis points and an annual premium of 50 basis points.
9. First-time homebuyers who would otherwise pay an upfront premium of 225 basis points, but who complete pre-purchase homeownership counseling acceptable to the Secretary, will pay an upfront premium of no more than 200 basis points.
