Critical Update on FHA’s New MIP Cancellation Procedures

The Federal Housing Administration (FHA) has
issued a critical update related to last week’s announcement of FHA
premium changes.  The update contains instructions for lenders wishing to cancel case numbers for
loans in process pursuant to Mortgagee Letter 2015-01.

The announcement of a .5 reduction in the
annual Mortgage Insurance Premium (MIP) for FHA loans affects loans with case
numbers assigned on and after January 26, 2015. 
The Mortgagee Letter acknowledges the need for borrowers with case
numbers assigned but with loans not yet closed and funded, to benefit from the
reductions as well.   Lenders currently processing such loans may begin
submitting Case Number Cancellation Requests
beginning on January 15
.  All requests
must be submitted prior to midnight on Thursday, February 26, 2015.  

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