A brief Look at Mortgage Insurance Premium in Seattle If you’ve been thinking about purchasing a home, you’re probably already aware of the different home loan options that may be available to you, one of which is an FHA or Federal Housing Administration home loan. If you decide on this loan program, one of the components to be aware of is the MIP or Mortgage Insurance Premium. This fee works differently than with other types of home loans and is charged to borrowers no matter how much money is put down. There are 2 types of MIP’s that are required on ALL FHA loans. One is paid up front with closing costs while the other can be included in the borrower’s monthly mortgage payments. If you decide to refinance your mortgage to another FHA loan within the first 3 years, you’d qualify for a pro-rated refund of the fee you paid up front. The amount of MIP that you pay will depend on the amount of your down payment. At this point, you’re probably wondering why you have to pay MIP. The Mortgage Insurance Premium protects investors on loans should the borrower default on their monthly mortgage payments and the home gets foreclosed on. In the event that this happens, the MIP is used to help repay that portion of the home loan balance that is lost on the ensuing sale of the property. https://www.google.com/maps?cid=1728001048712065545