MIP RefundHow can you determine if you have a mortgage insurance premium or MIP refund due you?  The FHA has published guidelines that can show you if you are eligible and tables that will help you determine if you have an MIP refund coming to you.  Additionally, there are many experts that can guide you through the process if you should require assistance.

In a nutshell, if you paid off an FHA loan through the sale of property or are refinancing from an FHA loan to a non FHA loan, you could be eligible for an FHA mortgage insurance premium (MIP) refund.  The main qualifications are that your loan originated after September 1, 1983, but before December 8, 2004; you paid an upfront mortgage insurance premium at closing and, lastly, did not default on your mortgage payments.

As with anything in life, there are some exceptions that may apply to your particular situation.  FHA borrower's that meet any of the following criteria may not be eligible for the MIP refund:

  • FHA to FHA refinances:  When an FHA loan is refinanced, the refund from the old premium may be applied toward the upfront premium required for the new loan.
  • Assumptions:  When an FHA insured loan is assumed by a new buyer, the insurance remains in force (i.e. the seller receives no refund).  The new owner of the property may be eligible for a refund once the loan is fully paid.
  • Claims:  If a mortgage company submits a claim to HUD for insurance benefits, no refund is due the homeowner.
You should receive a check or an application for refund from HUD within 45 days after you have paid off your loan.  If you do not, then check with your mortgage company confirming that they have sent HUD the Request for Termination form.  If your mortgage company confirms that the correct termination information was sent, your next contact is HUD.  If by some stroke of misfortune you do not receive a refund or any other documentation from HUD within 60 days from the date you mailed your claim form, contact HUD immediately.

If you are a very busy person and do not have the time to do all the above yourself, it is best to engage someone like FHA Secure and they can ride herd over the process for you.  Any way you look at it, some more money in your pocket is always a bonus.