One-time FHA mortgage-insurance charge usually assessed at closing and often financed into the starting loan balance.
Upfront mortgage insurance premium (UFMIP) is the one-time FHA mortgage-insurance charge usually assessed when the loan closes.
UFMIP matters because it affects the real cost of an FHA mortgage at the start of the transaction. Even when the borrower does not pay it fully in cash at closing, financing it into the loan still increases leverage and lifetime borrowing cost.
UFMIP is separate from the recurring Annual Mortgage Insurance Premium (MIP).
| FHA insurance piece | Timing | Main effect |
| — | — | — |
| UFMIP | Closing or origination | Raises cash needed at closing or raises opening balance if financed |
| Annual MIP | Over time, usually monthly | Raises the ongoing payment |
Borrowers often focus only on the monthly payment, but UFMIP changes the economics even before the first scheduled payment is made.
If the base loan amount is $200,000 and the applicable UFMIP rate is 1.75%, then:
Rolling the premium into the mortgage changes when the borrower pays it, not whether the borrower pays it.
Borrowers often face both UFMIP and annual MIP, so the full FHA insurance cost has to be assessed as a package.
When reviewing Upfront Mortgage Insurance Premium (UFMIP), ask whether it changes collateral value, lien priority, property cash flow, borrower capacity, closing funds, servicing, refinancing, or recovery proceeds. If it does, tie Upfront Mortgage Insurance Premium (UFMIP) to the loan file, title or contract evidence, underwriting ratio, and exit-risk assumption.