MIP, UFMIP, VAFF, PMI, LPMI What are all of these?
Quick and easy reference guide:
MIP = Mortgage Insurance Premium - this acronym is used for FHA's annual mortgage insurance premium, which is paid on a monthly basis as part of your Mortgage Payment.
UFMIP = Upfront Mortgage Insurance Premium - in addition to the annual MIP, FHA charges a one time UFMIP when your loan in originated. This helps to keep the monthly costs affordable by splitting the cost into two parts.
VAFF = VA Funding Fee. The VA doesn't require Mortgage Insurance, but it does fund the VA guarantee with their VAFF or VA Funding Fee. This ranges from .50% on a VA Irrrl Streamline refi to 3.3% on a subsequent use for purchase or refinance. Note- if you have a 10% VA Disability Rating you may be eligible to waive the VAFF.
PMI = Private Mortgage Insurance - This is mortgage insurance for Conventional loans such as Fannie Mae and Freddie Mac loans. This can be Monthly or one-time paid up front.
LPMI = Lender Paid Mortgage Insurance - This is where the lender pays your Mortgage Insurance as part of the rate, usually with a slightly higher rate. Definitely worth considering, call for a quote, this changes with the market very fast.
Please give us a call if we can answer your questions regarding the various types of Mortgage Insurance and Mortgage Guarantees available.
