FHA Single Family Housing Policy Handbook 4000.1, II. ORIGINATION THROUGH POST-CLOSING/ENDORSEMENT > B. Title II Insured Housing Programs Reverse Mortgages > 3. Allowable Mortgage Parameters — i. Mortgage Insurance Premiums
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FHA Single Family Housing Policy Handbook 4000.1, Part II — i. Mortgage Insurance Premiums (04/29/2024)
Effective 2024-04-29 · publisher's stamp for this provision
i. Mortgage Insurance Premiums (04/29/2024)
FHA collects a one-time IMIP and an annual insurance premium, also referred to as the
monthly Mortgage Insurance Premium (MIP), which is collected in monthly installments.
i. Initial Mortgage Insurance Premium
(A) Definition
Late Charges refer to charges assessed if the IMIP payment is received more than
twenty Days after the Closing Date.
(B) Standard
The IMIP is the responsibility of the Borrower and must be financed or paid in cash
by the Borrower. Any amount not paid in cash must be financed. Any IMIP amount
paid in cash is added to the total cash requirements due at closing.
Mortgagees may pay a portion or the full amount of IMIP on behalf of the Borrower.
(1) Initial Mortgage Insurance Premium Payment Due Date
The Mortgagee must remit the IMIP within 15 Days of the Closing Date and as a
condition of endorsement. See IMIP Late Charge and Interest for additional
information.
(2) Initial Mortgage Insurance Premium Amount
FHA charges an IMIP of 2 percent of the MCA.
The IMIP must be financed or paid in cash by the Borrower or Mortgagee. The
Borrower and/or Mortgagee may pay a portion or the full amount of the IMIP.
Any amount not paid in cash must be financed. Any IMIP amounts paid in cash
are added to the total cash requirements due at closing.
See the Initial Mortgage Insurance Premium Amount section in the HECM for
Purchase product sheet.
ii. Annual Mortgage Insurance Premium
The annual MIP is payable monthly. FHA charges an annual MIP of 0.50 percent on the
outstanding mortgage balance. The amount of the annual MIP will begin to accrue on the
outstanding mortgage balance from the Closing Date.
4. Underwriting the Property
The Mortgagee must underwrite the completed appraisal report to determine if the Property
provides sufficient collateral for the FHA-insured HECM. The appraisal and Property must
comply with the requirements in the Appraiser and Property Requirements for Title II Forward
and Reverse Mortgages. The appraisal must be reported in accordance with the Acceptable
Reporting Forms and Protocols.
Source: FHA Single Family Housing Policy Handbook 4000.1, Update 18 (issued 2026-08-12) · source URL · snapshot e1bca3432cf19e09
Operationalizing FHA Single Family Housing Policy Handbook 4000.1, II. ORIGINATION THROUGH POST-CLOSING/ENDORSEMENT > B. Title II Insured Housing Programs Reverse Mortgages > 3. Allowable Mortgage Parameters — i. Mortgage Insurance Premiums
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