Calculating Mortgage Insurance Premiums and Payments

Use the MIP/PMI/Guarantee Fee calculator to calculate mortgage insurance premiums and monthly payments. The calculator is accessible from the mortgage insurance sections of forms such as the 1003, 2010 or 2015 Itemization, REGZ-TIL, RegZ-LE, Closing RegZ, and RegZ-CD. If you are calculating mortgage insurance premiums and monthly payments for a USDA loan, refer to Calculating Mortgage Insurance Premiums and Payments for USDA Loans.

When you use the MIP/PMI/Guarantee Fee calculator to update the up-front or annual fees from any input form other than the 2010 Itemization or HUD-1 Page 2, the associated fields on the 2010 GFE (NEWHUD.X622 and NEWHUD.X692) will be updated if the loan has not been disclosed or if the Changed Circumstance checkbox on the 2010 GFE.

To comply with ML 2008-22 pricing changes for FHA loans (effective October 1, 2008), download the latest FHA MI tables using the following procedure.

To Download the Most Recent FHA MI Scenarios

Upfront Mortgage Insurance Premium / Funding / Guarantee Fee Section

This section is primarily for FHA and VA loans, which require payment of a mortgage insurance premium (FHA) or funding fee (VA) to obtain the loan.

To Calculate the Premium or Funding Fee

Enter the Base Loan Amount if it has not been populated from the Borrower Summary form. When you enter an amount in the calculator, it is copied to the appropriate field in the Borrower Summary form.
Type a percentage for MIP / Funding / Guarantee, and then click any other field to calculate the remaining fields.

For FHA loans, this field will be automatically completed when you click the Get MI button in the Monthly Mortgage Insurance premium section.
If the borrower will pay all or part of the premium in cash, select the Lock checkbox, type the amount in the Amount Paid in Cash field, and then click any other field to recalculate.
- Select the MI Factor Field Locked checkbox to lock the MIP / Funding / Guarantee field. When locked, this field will not be recalculated based on changes to the Amount Paid in Cash value. If you clear the MI Factor Field Locked checkbox later, the upfront factor will be recalculated based on the amount paid in cash.
Because FHA and VA loans deal with whole dollar amounts only, any amounts in cents will be recorded in the Amount Paid in Cash field.
Select the Round to nearest $50 checkbox to round the Upfront MIP/Funding/Guarantee Fee Financed amount.

Monthly Mortgage Insurance / USDA Annual Fee Premium Section

This section calculates monthly mortgage payments required for FHA and VA mortgage insurance as well as private mortgage insurance (PMI). Enter the data for this section manually. Or, if your system administrator has set up MI (mortgage insurance) tables, click the Get MI button to populate the data from the appropriate MI table. For details about downloading the most recent MI Tables, refer to MI Tables.

Use the Get MI button to calculate mortgage insurance premiums for FHA loans. If your administrator has downloaded the most recent FHA mortgage insurance scenarios, the calculator will import the appropriate FHA mortgage insurance information for the loan.

To Calculate Monthly Mortgage Insurance Payments Manually

Select a value from the Calculated Based On list.
On line 1, type the rate for the insurance payments in the % field, and then type the number of months the payments will be made in the Months field.
If the borrower is scheduled to make additional series of payments after the payments on line 1 have ended, use line 2 to enter the percentage rate and number of months for the additional payments.
Enter a percentage in the Cancel At field. The entry in this field will cause the mortgage insurance to be automatically canceled when the loan balance reaches a percentage of the value you selected from the Calculated Based On list.
FHA loans will display a Calculate based on remaining balance option, which will be auto-populated for FHA loans. This option calculates mortgage insurance payments based on an average of the remaining loan balance taken every 12 months. This average is used to calculate the mortgage insurance premiums listed in the payment schedule on the REGZ-TIL (for loans using the 2010 RESPA-TILA forms) or the RegZ-LE (for loans using the 2015 RESPA-TILA forms).
Select Midpoint payment cancellation to cancel mortgage insurance at the midpoint of the mortgage payments. For example, with a 360-month mortgage, the insurance would be canceled after 180 months.
For a conventional loan, select the Declining Renewals if you are using the declining balance option to calculate mortgage insurance payments after the first year. The declining balance option calculates monthly MI payments by multiplying the remaining loan amount by the mortgage insurance rate, and then dividing by 12.
If mortgage insurance premiums are being paid at closing, the Number of Months MI being Collected will be copied from the REGZ-TIL or Closing RegZ (for loans using the 2010 RESPA-TILA forms) or the RegZ-LE or RegZ-CD (for loans using the 2015 RESPA-TILA forms). Select the Prepaid checkbox to apply these premiums to the payment stream in the Payment Schedule on the REGZ-TIL, Closing RegZ, RegZ-LE, or RegZ-CD.

To Calculate Monthly Mortgage Insurance Using the Get MI Button

Click the Get MI button.
- If the loan does not meet the criteria in any of the MI tables, a message will display.
- If the loan matches the criteria of only one MI table, the data from the table will be populated into the Monthly Insurance Payments fields.
If the loan matches the criteria for multiple MI tables, select a table when the Select MI window opens, and then click Select.
- The data from the table will be populated into the Monthly Insurance Payments fields.

Mortgage Insurance (FHA and VA) Section

This section is used to enter information required specific to FHA and/or VA loans.

To Record Source Funds and VA Loan Program Information