It is certainly true, but
- not every FHA-insured borrower is eligible for this refund;
- even those who are, cannot get all the money paid as insurance premiums back
Normally, if you are eligible you receive a check or an application within 45 days after you paid off your loan. Your mortgage company sends HUD a request to terminate the mortgage insurance on your loan. You should receive the refund or some other documentation from HUD within 120 days after the date you mailed your application.
If none of that has happened to you, you may still be unawares entitled to the refund.
Eligibility.
Premium Refund: You may be eligible for a refund of a portion of the insurance premium if you:
- acquired your loan after September 1, 1983
- paid an up-front mortgage insurance premium at closing and
- did not default on your mortgage payments
NB Review your settlement papers or check with your mortgage company to determine if you paid an up-front premium.
Distributive Share:
You may be eligible for a share of any excess earnings from the Mutual Mortgage Insurance Fund if you:
- originated your loan before September 1, 1983
- paid on your loan for more than seven years and
- had your FHA insurance terminated before November 5, 1990.
The indications above are just the canvas. There are exceptions and other qualifications involved. You can read the complete information on the official FHA web-page. The easier way to find out if you are eligible is to go directly to this page. All this information can be acquired for free! You do not need to pay any third parties to have it done for you. There have appeared companies eager to make money out of people’s innocent ignorance in certain matters. The FHA explicitly alerts the borrowers against the scam.
And remember: HUD says that approximately 30 percent of those refunds never get claimed. Don’t miss your chance – there is about half a million bucks in the treasury waiting to be claimed!
