Global Data Integrity Checks: Revised FHA UFMIP and Annual MIP Rate Checks

As announced previously, the FHA Annual Mortgage Insurance Premium (MIP) rates were lowered for most mortgages by 0.30% as outlined in ML 2023-05. The Base Loan Amount threshold used to establish MIP rates was also updated to the conforming loan limit. These lower rates are “effective for case numbers endorsed on or after March 20, 2023”. The Upfront Mortgage Insurance Premium (UFMIP) did not change.

New FHA MIP Rate Checks

Previously the FHA case number assignment date was used instead of the endorsement date to distinguish between different sets of rates. Since the endorsement date is not usually known at the time documents are printed, new FHA data integrity checks have been implemented in ConformX to allow either the new or old applicable MIP rate to be allowed through based on the Loan Term (FI 1065), Loan to Value Ratio (FI 8238), and Base Loan Amount (FI 272). No additional information is needed to trigger this new set of FHA checks that support both the older and newer MIP values.

All new data integrity checks outlined in this announcement will trigger based on the existing ConformX System Default “FHA UFMIP/Annual MIP Data Integrity Check Options” (FI 109898). Hard stop Error checks will be evaluated if set to “Errors” and Warning messages will be evaluated if set to “Warnings”. None of the new checks will be evaluated if set to “None”.  The checks run by default in the following Document Package Types: Initial Disclosure, Redisclosure, TILA Redisclosure, Underwriting, Pre-Closing, and Closing.

Since the UFMIP rate was not modified, only 1.75% will be allowed through for most FHA loans. See below for Special Loan Type Checks that are exceptions to the standard rates.

Removal of Outdated FHA UFMIP/MIP Rate Checks

Several data integrity checks that verified if the UFMIP/MIP was correct for FHA case number assignment dates older than January 26, 2015, have been removed from ConformX.  See Special Loan Type Checks below for loan types that did not change rate.

Specific MIP Rate Checks Available

If a client would like to allow through only the newer set of MIP rates effective for case numbers endorsed on or after March 20, 2023, or only the older set of MIP rates effective for case numbers endorsed before March 20, 2023, new field FHA UFMIP/MIP Rate Effective Date (FI 173345, renamed from FHA Case Number Endorsement Date as announced previously) can be set in ConformX to trigger only the applicable set.

• If FHA UFMIP/MIP Rate Effective Date is set to a date on or after March 20, 2023, new data integrity checks that only allow the applicable new MIP values through will be evaluated. For exmple:

The FHA Annual MIP rate should be 0.50% for loan term more than 15 years, LTV less than or equal to 95.00%, and base loan amount less than or equal to $726,200. The Annual MIP rate on this loan is currently set to {MIP Rate Displayed Here}%.

• If FHA UFMIP/MIP Rate Effective Date is set to a date before March 20, 2023, the older existing data integrity checks that only allow the applicable older MIP values through will be evaluated. For example:

The UFMIP rate should be 1.75% and the annual MIP rate should be .80% for loan term over 15 years with LTV 95.00% or less, base loan amount of $625,500 or less, and FHA case number assigned on or after 1/26/15. The UFMIP rate on this loan is currently set to {UFMIP Rate Displayed Here}%.  The MIP rate on this loan is currently set to {MIP Rate Displayed Here}%.

• If the FHA UFMIP/MIP Rate Effective Date is not set, the new data integrity checks that allow either the applicable old or new MIP values through will be evaluated.

Invalid FHA Annual MIP rate for loan term more than 15 years and LTV less than or equal to 95.00%. The Annual MIP rate on this loan is currently set to {MIP Rate Displayed Here}%.

Special Loan Type Checks

Updated data integrity checks have also been implemented for these special types of loans:

• Streamline Refinance or Simple Refinance
  • If previous FHA loan endorsement date [Existing FHA Loan Endorsement Date (required for UFMIP/MIP rate check), FI 52340] is on or before May 31, 2009, only 0.01% for UFMIP and 0.55% for MIP will be allowed through.
  • If previous endorsement date is after May 31, 2009, then the rate checks first outlined above will be evaluated.
  • If previous endorsement date is empty, then the old, new, or special 0.01%/0.55% rates will be allowed through.

• Section 184 Indian Home Loan
  • 25% MIP (only for LTV over 78% and not Hawaii Section 184A) and 1.50% UFMIP required.

• Section 247 Hawaiian Home Lands
  • MIP should not be charged, so MIP must be empty or 0.00%.

• Section 248 Indian Lands
  • Excluded from regular UFMIP and MIP checks.
  • Existing data integrity check to verify the LTV PMI/MIP Cutoff (FI 1076) is set to 0.00% has not been modified.

List of ConformX FHA UFMIP/MIP Rate Data Integrity Checks

For a comprehensive list of related checks, please contact your Client Relationship Manager directly or contact our Client Support Team at 1.800.497.3584. Additional information will include:

• A Field Key with ConformX field data references.

• New Errors and Warnings evaluated when FHA UFMIP/MIP Rate Effective Date is empty. These data integrity messages will not include the expected MIP value since it could be the value effective for mortgage endorsement dates prior to March 20, 2023, or the value effective for mortgage endorsement dates on or after March 20, 2023.

• New Errors and Warnings evaluated when FHA UFMIP/MIP Rate Effective Date is on or after March 20, 2023. The expected UFMIP and MIP values are included in these messages.

• Updated Errors and Warnings evaluated when FHA UFMIP/MIP Rate Effective Date is prior to March 20, 2023. The expected UFMIP and MIP values are included in these messages.

• Outdated Errors that have been removed from ConformX.

FHA Example Update

Informed Consumer Choice Disclosure Notice (Cx41) has been updated.  The prepared date has been changed from “January, 2023” to “March, 2023”, and the “Monthly Mortgage Insurance Premium (MIP)” has been updated from “$204.12” to “$132.08” to reflect the lower MIP rate of 0.55%.

Deployment

These data integrity check changes and document updates are on Stage 1 and Stage 2 servers for testing. These changes will be in effect on ConformX Production March 16, 2023. If you have any questions or concerns, please contact Client Support at 1.800.497.3584.

T3S-6728
DR-140771

The preceding is for informational purposes only and is not and may not be construed as legal advice. No third party entity may rely upon anything contained herein when making legal and/or other determinations regarding its practices, and such third party should consult with an attorney prior to embarking upon any specific course of action.