FHA Mortgage Insurance

Mortgage insurance is a policy that protects lenders against losses that result from defaults on home mortgages. FHA loans require mortgage insurance primarily for borrowers making a down payment of less than 20 percent.

Mortgage insurance is charged to the homeowner each month at the rate of .55% for above 95% LTV and .50% at or below 95% LTV. FHA also charges an upfront mortgage insurance premium of 1.75 percent.

FHA's monthly mortgage insurance payments will be automatically terminated when these conditions occur:

  For mortgages with terms 15 years and less and with Loan to Value ratios 90 percent and greater, annual premiums will be canceled when the Loan to Value ratio reaches 78 percent regardless of the amount of time the mortgagor has paid the premiums.

  For mortgages with terms more than 15 years, the annual mortgage insurance premiums will be canceled when the Loan to Value ratio reaches 78 percent, provided the mortgagor has paid the annual premium for at least 5 years.

  Mortgages with terms 15 years and less and with Loan to Value ratios of 89.99 percent and less will not be charged annual mortgage insurance premiums.




Financial Services Unlimited, Inc.
Client Services: 800-238-9202
11950 SW 2nd St. Suite 300
Beaverton, OR 97005
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