- closed on or after January 1, 2001; and
- have a case number assignment before June 3, 2013.
HUD will not consider new appraised values when calculating whether the Borrower has reached the required Loan-to-Value (LTV) ratio necessary for annual MIP cancellation. The LTV ratio is based on the principal balance excluding Upfront MIP (UFMIP). HUD bases the cancellation of the annual MIP on the initial amortization schedule.
Mortgage Term of More Than 15 Years
HUD automatically cancels the annual MIP when the LTV ratio reaches 78 percent of the lesser of the initial sales price or appraised value at origination, provided the Borrower has paid the annual MIP for at least five years.
Mortgage Term of 15 Years or Less; and
- LTV ratio 90 percent and greater (Closed on or after January 1, 2001 with case number assigned before July 14, 2008); or
- LTV ratio greater than 90 percent (case number assigned on and after July 14, 2008 and before June 3, 2013); or
- LTV ratio greater than 78 percent but equal or less than 90 percent (closed on or after January 1, 2001 with case number assigned before June 3, 2013).
NOTE: HUD does not charge annual MIP for Mortgages with terms of 15 years or less which
- closed on or after January 1, 2001 and have a case number assigned before July 14, 2008 with an LTV ratio of less than 90 percent;
- have a case number assigned on or after July 14, 2008 but before April 18, 2011 with an LTV ratio of 90 percent or less; or
- have a case number assigned on or after April 18, 2011 but before June 3, 2013 with an LTV ratio of 78 percent or less.
- the Borrower has reached the 78 percent threshold in advance of the scheduled amortization due to Borrower prepayments to the principal, but not sooner than five years from the Closing Date, except for 15-year term Mortgages; and
- the Borrower has not been more than 30 Days Delinquent on the Mortgage during the previous 12 months.
A Borrower with an outstanding Partial Claim/second Mortgage is not eligible to cancel their MIP even if all other above requirements have been satisfied.
For policy information see Handbook 4000.1, Section III.A.1.k. at: https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh
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