Finance
A Colorado buyer's FHA loan requires a Mortgage Insurance Premium (MIP). The upfront MIP is:
A0.5% of the loan amount paid at closing
B1.75% of the loan amount, which may be financed into the loan✓ Correct
C3.5% of the purchase price paid at closing
DNo upfront MIP — only monthly MIP is required
Explanation
FHA loans require an upfront mortgage insurance premium (UFMIP) of 1.75% of the base loan amount, which can be paid at closing or financed into the loan. Annual MIP (paid monthly) is also required for the life of the loan or until LTV reaches 78%.
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