“Federal Housing Administration leadership should increase the mortgage insurance premium (MIP) for all products above 20-year terms and maintain MIP for all products below 20-year terms and all refinances.” (General Welfare, Dept. of Housing, Page 510)

The MIP is a fee paid by borrowers who obtain FHA-insured home loans. Its intent is to protect lenders from risk and fund other FHA programs. The Biden Administration took steps to reduce the annual MIP charged to homebuyers, saving American families an average of $800 annually.

Project 2025’s proposed policy would increase the annual MIP for any mortgage that’s longer than 20 years. This would increase costs for first-time and lower-income homebuyers who often purchase using a 30-year mortgage to have a lower monthly mortgage payment.