MIP (Mortgage Insurance Premium)
FHA insurance charged on every HECM that funds the non-recourse protections and other program guarantees.
Mortgage Insurance Premium (MIP) is the FHA insurance charge built into every HECM reverse mortgage. It funds the program's borrower protections, including the non-recourse limit and the guarantee that promised loan advances will continue even if the lender fails.
MIP has two pieces. An initial MIP is charged at closing as a percentage of the home value or HECM lending limit, whichever is less. An annual MIP is then charged on the outstanding loan balance throughout the life of the loan and added to the balance over time.
Because MIP accrues against the loan balance rather than being paid out of pocket, it is a real cost of the HECM program that should be reviewed alongside interest, origination fees, and other charges when comparing reverse mortgage options.
Related terms
Have questions about a reverse mortgage?
Talk with Ventana before you make a decision. The first conversation is about clarity, not pressure.