FHA The MIP Conundrum

Many of us have been hoping for a reduction in the FHA lenders default risk insurance, known by the acronym “MIP” mortgage insurance protection.   We may be stuck at the .85% level on a 30 year loan with minimum down payment of 3.50% for some time to come.  Sharing a history of the premiums over the last 15 years.  So today’s .85% on a 30 year and .70% on a 15 year look good by comparison.  Prior to July 2008 a 30 year was 0.55%, then by October of 2010, we saw a jump to 0.90%.  Then the dreaded April, 2011, when the rate went 1.15%, April 2013, jumped again to 1.35%.  Finally a breather with a reduction in January, 2015 to 0.85%.  We can only hope as HUD re-evaluates costs the MIP will be reduced as we had been initially told in early January of this year, 2017.   So maybe late Spring or Summer we will have a thaw.  Until then keep working towards your dream of home ownership, a great slice of our American dream!


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