www.hudclips.org U. S. Department of Housing and Urban Development Washington, D.C. 20410-8000 January 5, 1994 OFFICE OF THE ASSISTANT SECRETARY FOR HOUSING-FEDERAL HOUSING COMMISSIONER Mortgagee Letter 94-1 TO: ALL APPROVED MORTGAGEES SUBJECT: Revision to form HUD-27001, Transmittal for Payment of One-Time Mortgage Insurance Premium (OTMIP) The Department of Housing and Urban Development (HUD) has revised the form HUD-27001, Part 4, Old Case Up-Front Mortgage Insurance Premiums (UFMIP) Refund Data for FHA Refund Credit, to reflect recent program changes. These changes will be in effect for all mortgage terminations and refinances closed on or after January 1, 1994. This is applicable to those mortgages insured under the provisions of the Mutual Mortgage Insurance Fund. The Department has also clarified instructions for preparation of the form. A copy of the revised form is attached. The changes are as follows: 1. OTMIP was replaced on the form with UFMIP to reflect the change from OTMIP to the Risk-Based Premium structure which includes the up-front and monthly premiums (Note: monthly premiums are reported separately on form HUD-2752, Risk-Based Premiums: Monthly Remittance Summary). 2. A section was inserted (before Part 1) for you to indicate the type of loan you are submitting. Please follow the directions for the completion of the form, based on your selection of loan type. 3. The captions for Parts 2, 3 and 4 were changed to clarify what information should be entered. 4. The instructions for Item 3b were changed to clarify what amount should be entered. Please note that the amount in 3b can never be greater than the amount in 3a. 5. Item 4b was changed to read "Computed Premium". This is the amount of prepaid (OTMIP or UFMIP) premium required for insurance of the old mortgage. Please recompute the prepaid premium amount to verify correctness of the original computation. _____________________________________________________________________ 2 6. Item 4f was changed to Premium Refund Factor to reflect the name of the new Earnings Factors tables. The refund factor should be selected from Attachment 2 of this mortgagee letter. The factor should be entered starting in the space following the decimal. If it is less than 5 numbers, leave the fifth space blank. (Note: The Premium Refund Factor provided on the printout of the Netting Authorization Report is 5 numbers because it has an added zero at the end.) 7. Item 4g was changed to reflect the new computation of the amount earned by HUD. To compute this amount, subtract the amount of the refund credit (which will be entered in 4h) from the old case computed premium (4b). 8. Item 4h is changed to reflect the new computation of the refund credit. To compute the refund credit, multiply the computed premium in 4b by the factor in 4f. 9. A space is provided for the entry of your Netting Authorization Number. Although the entry of the Netting Authorization Number on this form is optional, it is always advisable to obtain a netting authorization number when you are expecting to apply the unearned premium toward the MIP for the new loan. Please note that the information in Part 4 can be taken directly from the netting authorization report IF YOU ARE CLOSING THE LOAN IN EITHER OF THE MONTHS SHOWN ON THE REPORT. HOWEVER, ALL INFORMATION ON THE NETTING AUTHORIZATION REPORT SHOULD BE RECONCILED TO THE MORTGAGEE DATA. IF YOU ARE UNABLE TO RECONCILE ANY DIFFERENCES, YOU SHOULD CONTACT THE TELEPHONE SERVICE CENTER AT (703) 235-8117. You may obtain a supply of the revised form HUD-27001 by contacting your local office or you may photocopy the attached form. If your local Field Office does not have a supply of the revised forms, please photocopy the attached form for use until the revised form is stocked. If you have any questions on the new form, please contact the Telephone Service Center at (703) 235-8117. _____________________________________________________________________ 3 Use of the Automated Clearing House (ACH) system is now mandatory for the remittance of Single Family Mortgage Insurance Premiums. The revised form HUD-27001 is only for use during your transition to your participation in ACH. To obtain more information on ACH or to sign-up, contact the ACH Outreach Team at (703) 845-4991. Very sincerely yours, ________________________________ Nicolas P. Retsinas Assistant Secretary for Housing - Federal Housing Commissioner Attachments _____________________________________________________________________ ___________________________________________________________________________ Transmittal for Payment Up Front Mortgage Insurance Premium (UFMIP) ******************************************************************** * * * * * * * * * * * * * * * * * * * GRAPHICS MATERIAL IN ORIGINAL DOCUMENT OMITTED * * * * * * * * * * * * * * * * * * * ******************************************************************** ___________________________________________________________________________ ref. Handbook 4110.2 form HUD-27001 (1/94) _____________________________________________________________________ __________________________________________________________________________ General Instructions: ******************************************************************** * * * * * * * * * * * * * * * * * * * GRAPHICS MATERIAL IN ORIGINAL DOCUMENT OMITTED * * * * * * * * * * * * * * * * * * * ******************************************************************** __________________________________________________________________________ ref. Handbook 4110.2 form HUD-27001 (1/94) _____________________________________________________________________ ATTACHMENT 2 ===================================================================== REVISED MIP REFUND FACTORS _____________________________________________________________________ YEAR 1 YEAR 4 YEAR 7 __________________ __________________ __________________ Month 1 0.9917 Month 37 0.5840 Month 73 0.0770 Month 2 0.9833 Month 38 0.5660 Month 74 0.0700 Month 3 0.9750 Month 39 0.5480 Month 75 0.0630 Month 4 0.9667 Month 40 0.5300 Month 78 0.0560 Month 5 0.9583 Month 41 0.5120 Month 77 0.0490 Month 6 0.9500 Month 42 0.4940 Month 78 0.0420 Month 7 0.9417 Month 43 0.4760 Month 79 0.0350 Month 8 0.9333 Month 44 0.4580 Month 80 0.0280 Month 9 0.9250 Month 45 0.4400 Month 81 0.0210 Month 10 0.9167 Month 46 0.4220 Month 82 0.0140 Month 11 0.9083 Month 47 0.4040 Month 83 0.0070 Month 12 0.9000 Month 48 0.3860 Month 84 0.0000 YEAR 2 YEAR 5 YEAR 8 Month 13 0.8917 Month 49 0.3720 Month 85 Month 14 0.8833 Month 50 0.3580 and beyond 0.0000 Month 15 0.8750 Month 51 0.3440 Month 16 0.8687 Month 52 0.3300 Month 17 0.8583 Month 53 0.3160 Month 18 0.8500 Month 54 0.3020 Month 19 0.8417 Month 55 0.2880 Month 20 0.8333 Month 56 0.2740 Month 21 0.8250 Month 57 0.2600 Month 22 0.8167 Month 58 0.2450 Month 23 0.8083 Month 59 0.2320 Month 24 0.8000 Month 60 0.2188 YEAR 3 YEAR 6 Month 25 0.7835 Month 61 0.2068 Month 26 0.7870 Month 62 0.1967 Month 27 0.7505 Month 63 0.1845 Month 28 0.7340 Month 64 0.1733 Month 29 0.7175 Month 65 0.1622 Month 30 0.7010 Month 66 0.1510 Month 31 0.6845 Month 67 0.1398 Month 32 0.6680 Month 68 0.1287 Month 33 0.6515 Month 69 0.1175 Month 34 0.6350 Month 70 0.1083 Month 35 0.6185 Month 71 0.0952 Month 36 0.6020 Month 72 0.0840 =====================================================================