FHA Lowers Mortgage Insurance Premium Rates

March 14, 2023
On February 22, 2023, the Federal Housing Administration (FHA) announced a reduction on mortgage insurance premium (MIP) pricing for most Title II forward mortgages. The new MIP amounts to a 30 basis point reduction in the annual premium charged to borrowers who obtain an FHA-insured mortgage. The FHA stated that this reduction “will translate to […]

On February 22, 2023, the Federal Housing Administration (FHA) announced a reduction on mortgage insurance premium (MIP) pricing for most Title II forward mortgages. The new MIP amounts to a 30 basis point reduction in the annual premium charged to borrowers who obtain an FHA-insured mortgage. The FHA stated that this reduction “will translate to average annual savings of approximately $800, and even more for those with higher loan amounts.”

In addition to the reduction in premiums, the FHA also announced that the base loan amount threshold used to establish the applicable MIP rates will now be based on the national conforming loan limit. The conforming loan limit used to determine the applicable MIP for 2023 will be $726,200.

The annual MIP reductions and new base loan amount are effective for mortgages endorsed for insurance by the FHA on or after March 20, 2023.

The link to the FHA announcement can be found here: FHA Mortgagee Letter 2023-05

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