The Federal Housing Administration (FHA) has released Version 2.5 of the Home Equity Conversion Mortgage (HECM) Calculation Software on its Home Equity Conversion Mortgages for Lenders (HECMs) webpage under “Software.”
Version 2.5 of the HECM Calculation Software includes the new Initial Mortgage Insurance Premium (IMIP) formula for HECM refinance cases, the formula for which was modified Nov. 14, 2017, affecting case numbers assigned on or after Sept. 19, 2017.
The formula change conforms to requirements set forth in the Federal Register Final Rule FR-5353-F-03, Federal Housing Administration: Strengthening the Home Equity Conversion Mortgage Program.
FHA released notes in December detailing the calculations of IMIP for HECM refinances. The following formula is used to determine the amount of IMIP:
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