How long does MIP stay on an FHA loan when the borrower puts 10% down at purchase?

How long does MIP stay on an FHA loan when the borrower puts 10% down at purchase?

• A. 11 years
• B. 5 years
• C. Life of the loan
• D. 15 years

Answer: (A)

FHA mortgage insurance premium timing hinges on how much you put down. The annual MIP you pay each year is tied to your down payment amount. When you make a down payment of 10% or more, the MIP can be canceled after 11 years, provided you’ve kept the loan current and the loan originated under FHA rules. In contrast, putting down less than 10% generally means MIP remains for the life of the loan. Upfront MIP, charged at closing, is separate and cannot be canceled. So with a 10% down payment on an FHA loan, the monthly MIP typically ends after 11 years.

FHA mortgage insurance premium timing hinges on how much you put down. The annual MIP you pay each year is tied to your down payment amount. When you make a down payment of 10% or more, the MIP can be canceled after 11 years, provided you’ve kept the loan current and the loan originated under FHA rules. In contrast, putting down less than 10% generally means MIP remains for the life of the loan. Upfront MIP, charged at closing, is separate and cannot be canceled. So with a 10% down payment on an FHA loan, the monthly MIP typically ends after 11 years.