{"id":10274,"date":"2015-01-23T09:24:02","date_gmt":"2015-01-23T14:24:02","guid":{"rendered":"https:\/\/pfh.ysh.temporary.site\/website_d1c340c1\/?p=10274"},"modified":"2019-10-15T16:43:23","modified_gmt":"2019-10-15T20:43:23","slug":"fha-pmi-refinance-refund-chart","status":"publish","type":"post","link":"https:\/\/pfh.ysh.temporary.site\/website_d1c340c1\/fha\/fha-pmi-refinance-refund-chart\/","title":{"rendered":"FHA PMI Refinance Refund Chart"},"content":{"rendered":"

If you currently have a FHA Mortgage, and you are refinancing, either with a full “application” FHA Mortgage, or with a FHA Streamline Refinance which doesn’t have as much documentation, you might be eligible for a refund of part of your FHA PMI mortgage insurance<\/strong>.<\/p>\n

ALL mortgages that have less than a 20 percent down payment carry some sort of mortgage insurance. \u00a0This is the insurance that probably saved our Nation in the past few years when so many folks went into foreclosure.<\/p>\n

While it doesn’t pay the bank the FULL amount that it is owed – it will generally pay at least 20% of the balance, which gives a bank the opportunity to pay legal fees, maybe fix it up, etc. avoiding a complete loss. \u00a0It does YOU the consumer no real good – it’s for the Bank’s benefit, and we normally call that type of mortgage insurance PMI.<\/p>\n

FHA has a rate decrease coming to the\u00a0FHA PMI rates effective January 26, 2015.<\/strong> \u00a0With this .5% drop in the annual fee<\/a> – many people are confused about what that’s going to do to their payments.<\/p>\n

FHA PMI Refinance Refund<\/h2>\n

There are two types of FHA PMI Premiums charges on a loan. \u00a0One cost is the Upfront fee – this premium is generally added to the loan amount.<\/strong>\u00a0 This is NOT the part of the FHA PMI fees that are changing on January 26, 2015.<\/p>\n

The second “kind” of FHA PMI premiums charged, are included in with your monthly payments. \u00a0THOSE are the fees that are going down by 1\/2 a percent.<\/strong> \u00a0That can be significant.<\/em> \u00a0For someone with an initial loan of $225,000, once we add the upfront FHA PMI fees, that means you borrowed $228,937. \u00a0At today’s FHA PMI rate (before reduction) your MONTHLY FHA PMI fees would be $249.<\/strong><\/p>\n

This FHA PMI fee is also sometimes called the ANNUAL FHA MIP (Mortgage Insurance Premium) fee. \u00a0With the NEW FHA PMI rates in January, 2015 – the monthly fees on this same $228,937 loan will go down to $156 a month. Now you see why this is a HUGE DEAL.<\/strong><\/p>\n

The only way<\/em> <\/span>for folks to see this savings will be to refinance into a new FHA Loan<\/a>. \u00a0<\/strong><\/p>\n

But what about that almost $4000 that you paid in upfront FHA PMI Fees? \u00a0<\/strong><\/p>\n

The current upfront FHA PMI premium is equal to 1.75% of your loan amount. \u00a0Most borrowers add that upfront fee to their mortgage. \u00a0If you did that, and you borrowed $100,000 with\u00a0a FHA Loan, your total loan amount is $101,750. \u00a0If you refinance that loan, you could\u00a0be eligible for a FHA PMI Refinance refund of that “extra” (unused) upfront premium you paid, as long as you refinance within 36 months.<\/p>\n

You are only eligible for a refund of a portion of the refinance if you are refinancing from a FHA loan to another FHA loan.<\/strong> If you decide to refinance into a Conventional Loan (for instance) you will not get a refund. \u00a0The refund is never paid in cash<\/em> – it is typically applied to the upfront premium on the new FHA Loan.<\/p>\n

When\u00a0you refinance, however, you will miss a monthly Mortgage Payment – so that SHOULD be some extra cash in your pocket!<\/em><\/p>\n

The Refund of your FHA PMI Fees\/\u00a0an example from FHA<\/strong><\/p>\n