FHA MIP Refund Chart: Getting Money Back When You Refinance
The MIP refund chart Florida owners need applies when you refinance FHA to FHA within three years. Here is how much comes back and when.
Educational content only. This article is for informational purposes and does not constitute financial, legal, or lending advice. Loan programs, rates, and eligibility requirements change frequently. Consult a licensed mortgage professional before making any borrowing decision. Mortgage Capital | NMLS# 1859012 | Licensed in Florida.
When you take an FHA loan you pay an upfront mortgage insurance premium of 1.75%, usually financed into the balance.
If you refinance into another FHA loan within three years, part of that premium comes back. Our FHA page covers the programme.
How the refund works
The refund is a percentage of your original upfront premium, based on how many months have passed.
It starts high and falls every month, reaching zero at 36 months.
It is not paid to you in cash. It is credited against the new upfront premium on the replacement loan.
That still lowers what you finance, so the benefit is real.
Reading the chart
Refund at month one is around 80% of the original premium.
By month twelve it is roughly 50%. By month twenty-four it is about 20%.
By month thirty-six it is nothing.
HUD publishes the exact schedule, and your lender can pull your specific figure from the FHA Connection system.
What it is worth in real money
On a $300,000 FHA loan the upfront premium is $5,250.
Refinancing at month twelve returns roughly $2,600 against the new premium.
At month twenty-four it is closer to $1,050.
That difference is often enough to change whether a refinance clears its own costs.
The conditions
The refinance must be FHA to FHA. Moving to conventional forfeits the refund entirely.
It applies to refinances, not to selling the property.
You must be current on the loan.
Loans endorsed before certain dates follow different rules, so confirm yours rather than assuming.
The trap this creates
The refund only exists on an FHA-to-FHA refinance, which keeps you on FHA mortgage insurance.
On most current FHA loans that annual premium never cancels.
So chasing a refund can lock you into a permanent cost to recover a one-time one.
Run both scenarios before letting the refund drive the decision.
When refinancing to conventional wins anyway
If you hold 20% equity, conventional removes the annual premium permanently.
In South Florida, appreciation has carried plenty of 2021 and 2022 FHA buyers to that point already.
The monthly saving frequently exceeds $200, which outruns any refund within a year.
Check your position on the LTV calculator before deciding.
Timing the decision
If you are within a year of closing and rates have dropped, the refund is at its most valuable.
Between one and two years it shrinks quickly.
Past two years it is small enough that it should not influence the choice.
Past three it is gone entirely.
How to claim it
You do not claim it. Your lender applies it automatically on an eligible FHA-to-FHA refinance.
Ask to see it itemised on the Loan Estimate so you can confirm it was applied.
If you sold the property rather than refinancing, a separate refund process exists for some older loans.
HUD maintains the details at hud.gov.
Why the upfront premium exists
FHA is self-funded. The premiums pay the claims when borrowers default.
The upfront charge builds the reserve, and the annual charge maintains it.
That is why FHA can lend at 3.5% down to borrowers conventional would decline.
The refund exists because refinancing quickly means the fund carried less risk than it charged for.
Selling rather than refinancing
Selling the property does not trigger the refund on current loans.
Some older FHA loans carried a distributive share refund on payoff, and a small number remain unclaimed.
If you held an FHA loan before 2000 and sold it, it is worth checking whether one is owed.
HUD maintains a search for unclaimed refunds.
Getting the exact figure
Your lender pulls it from FHA Connection using your case number.
Do not rely on a chart you found online, since the schedule has been revised over the years.
Ask to see it on the Loan Estimate rather than taking it on trust.
If it does not appear, ask why. Occasionally a lender misses it.
A worked example
Take a $280,000 FHA loan closed eighteen months ago. The upfront premium was $4,900.
At month eighteen the refund runs roughly 35%, so about $1,715 credits against the new premium.
The new loan still charges 1.75% upfront, so you finance the difference rather than the whole amount.
That is real, but it is one-time. Weigh it against a permanent annual premium.
What to ask your lender
Confirm my FHA case number and pull the refund figure from FHA Connection.
Show it itemised on the Loan Estimate.
Then price a conventional refinance alongside, so I can see what dropping the annual premium is worth.
One more consideration
The refund only applies FHA to FHA. So it can quietly steer you into keeping mortgage insurance you could have shed.
Treat it as a tiebreaker rather than a reason.
Your equity position matters far more to the decision than the refund does.
Where to begin
Find your FHA case number and closing date. Those two facts produce your refund figure in minutes.
Then ask for both refinance options priced side by side before you commit to either.
Where to start
Find your closing date and count the months.
Ask us to price an FHA streamline with the refund applied, and a conventional refinance without it.
The right answer depends on your equity more than on the refund. Start with a pre-approval.