Qualified And Non-Qualified Mortgage Essentials Practice Test

Regarding FHA UFMIP refundability, which statement is correct?

Refundable within 3 years Nonrefundable, except when applied to another FHA loan within 3 years Refundable after 5 years Nonrefundable with no exceptions

Correct Answer:

Nonrefundable, except when applied to another FHA loan within 3 years

Explanation:

UFMIP, the upfront Mortgage Insurance Premium for FHA loans, is normally nonrefundable. The only exception is when you obtain another FHA loan within three years of the original loan; in that case, the UFMIP you already paid can be applied toward the new loan’s UFMIP credit, rather than giving you a cash refund. This means you don’t lose the previous premium—you just carry its value into the new FHA loan within that three-year window. The other options don’t fit because there isn’t a cash refund after a set period like five years, and the rule isn’t that it’s fully refundable without an exception.

Access more questions from this quiz

Continue to Qualified and Non-Qualified Mortgage Essentials Practice Test for more practice questions and the full quiz experience.

Access More Questions