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Is the PMI, MIP and funding fee always included in the loan amount?

by mana25rd_326_159 from Los Angeles, California. Aug 22nd 2011 Reply


Deborah Garvin (loanmonarch)
#492 ranked lender in California - 53 contributions

No, if you have an exceptionally generous seller and they contribute the maximum of seller contributions, there may be the opportunity to use those credits for covering all or some of the the PMI, MIP or funding fee. It would, however, not make much sense for a consumer to pay these fees out of pocket...the moneies would be better used as down payment to avoid the fees in the first place.

Aug 22nd 2011
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Gregorio Denny (GVDenny)
#253 ranked lender in California - 380 contributions

Those are 3 different things and thus 3 different answers. PMI is Private Mortgage Insurance and available on conventional mortgages. It can be included in the loan amount if you are doing LPMI (Lender Paid Mortgage Insurance) or buying out the premium so there is no monthly PMI. MIP (Mortgage Insurance Premium) is FHA's version of PMI, and also paid monthly. MIP is not included in the loan amount other than the portion that is paid Up Front as the Funding Fee. (UFMIP) So to answer: You will usually see an FHA funding fee as part of the loan amount but it does not have to be. You can pay the full FHA funding fee at closing if you wish. VA also has a funding fee that is usually financed as part of the loan. PMI is sometimes funded as a one time payment included in the loan amount or rate, but usually paid monthly. MIP is always paid monthly and never part of the loan amount.

Aug 22nd 2011
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Michael Ross (michael@cedarrivermortgage.com)
#39 ranked lender in Washington - 3 contributions

PMI is extra insurance that lenders require from most homebuyers.It is normally only included in the loan amount when it is charged up-front which is typical for a Government insured loan (FHA,VA,USDA). You usualy cannot split the fee so it will be all included or you will have to pay it up-front out of pocket or seller paid. So my opinion is YES... but without more information, don't hold me to that answer :) Regards

Aug 22nd 2011
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I have a PMI funding fee on my closing paperwork of $2,352 lumped in with my loan and also pay $147 a month to PMI is this correct? should I have both?

Apr 1st 2016
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