HUD Reduces Mortgage Insurance Premiums for All FHA Multifamily Insurance Programs

HUD recently announced a significant reduction in mortgage insurance premiums (MIPs) to 0.25% for all FHA multifamily insurance programs.  The HUD Secretary detailed that this change is necessary to counter a sharp rise in construction costs and mortgage interest rates in an effort to lower financing costs and expand the supply of rental housing in the country.

As a result of the change, HUD eliminated the MIP categories from 2016 for “Green and Energy Efficient Housing, Affordable Housing, and Broadly Affordable Housing” as the uniform MIP rate has rendered them obsolete.  Consequently, any green-related requirements (e.g., annual energy reporting, green regulatory riders, etc.) are also eliminated.

The revised MIP will be effective for any FHA multifamily mortgage insurance applications submitted or amended on or after October 1, 2025, so long as the loan has not been initially endorsed.