Informed Consumer Choice Disclosure Notice
IX. Government Guidelines 1 of 1 Document #9308-A
Return to Top 03/05/2020
In addition to an FHA-insured mortgage, you may also qualify for other mortgage products offered by your
lender. To ensure that you are aware of available financing options, your lender has prepared a comparison of
the typical costs of alternative conventional mortgage product(s), using representative loan amounts and costs.
The loan amounts and associated costs shows below will vary from your own mortgage loan transaction. You
should study the comparison carefully, ask questions, and determine which product is best for you. The
information provided below was prepared as of March, 2020
Neither your lender nor FHA warrants that you actually qualify for any mortgage loan offered by your lender.
This notice is provided to you to identify the key differences between these mortgage products. This disclosure
is not a contract and does not constitute loan approval. Actual mortgage approval can only be made following a
full underwriting analysis by your lender.
FHA Financing
203(b) Fixed Rate
Conventional Financing
95% with Mortgage Insurance
Sales Price
$100,000 $100,000
Mortgage Amount
$96,500 ($98,188 with the Up-Front
Mortgage Insurance Premium)
$95,000
Closing Costs
$,2000 $2,000
$3,500 $5,000
Interest Rate and Term of Loan in Years
3.75%/ 30-year term 3.75% 30-year term
Monthly Payment (principal and interest only)
$454.72 $439.96
Loan-to-Value
96.50% 95%
Monthly Mortgage Insurance Premium (first year) $67.78
1, 3
$75.20
Maximum Number of Years of Monthly Insurance
Premium Payments
30 years Approximately 11 Years
Up-front Mortgage Insurance Premium (if
applicable)
$1,688
2, 3
(Typically, included in
Mortgage Amount)
N/A
1.
The monthly MIP is calculated on the average annual principal balance, i.e., as the amount you owe on the loan decreases each year, so does the amount
of the monthly premium.
2.
Based on an up-front mortgage insurance premium rate of 1.75%, the total mortgage amount is $98,188
3.
Streamline refinances of FHA loans endorsed/insured by FHA prior to June 1, 2009 are subject to a reduced up-front mortgage insurance premium of
.01% and a reduced annual mortgage insurance premium of .55% ($44.22 monthly for a loan amount of $96,500)
FHA MORTGAGE INSURANCE PREMIUM INFORMATION
In addition to an upfront mortgage insurance premium, you may also be charged a monthly mortgage
insurance premium. You will pay the month premium for either:
• The first 30 years of the mortgage term, or the end of the mortgage term, whichever occurs first, for any
mortgage involving an original principal obligation (excluding financed UFMIP) with a LTV greater than
90 percent; or
• The first 11 years of the mortgage term, or the end of the mortgage term, whichever occurs first, if your
mortgage had an original principal obligation, (excluding financed UFMIP) with a LTV ratio of less than
or equal to 90 percent.
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