Finance (alternative)
A Maryland borrower using an FHA loan is required to pay Mortgage Insurance Premium (MIP). The MIP differs from PMI because it:
AIs lower than PMI
BIs charged upfront and as an annual premium regardless of equity level and protects the lender✓ Correct
CIs only required for the first 2 years
DIs paid by the seller
Explanation
FHA MIP includes both an upfront premium and an annual premium. Unlike conventional PMI, FHA MIP typically continues for the life of the loan (for low down payment loans), regardless of equity.
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