Application for FHA-Insured Mortgage

Important Notice to Homebuyers

U.S. Department of Housing
and Urban Development
Office of Housing - Federal
Housing Commissioner

OMB Approval No. 2502-0059
(Expires 04/30/2017)

You must read this entire document at the time you apply for the loan.
Return one copy to mortgagee as proof of notification and keep one copy for your records.
Condition of Property
The property you are buying is not HUD/FHA approved and HUD/FHA does not warrant the condition or the value
of the property. An appraisal will be performed to estimate the value of the property, but this appraisal does not
guarantee that the house is free of defects. You should inspect the property yourself very carefully or hire a
professional inspection service to inspect the property for you.
Interest Rate and Discount Points
a. HUD does not regulate the interest rate or the
discount points that may be paid by you or the
seller or other third party. You should shop around
to be sure you are satisfied with the loan terms
offered and with the service reputation of the
mortgagee you have chosen.
b. The interest rate, any discount points, and the
length of time the mortgagee will honor the loan
terms are all negotiated between you and the
mortgagee.
c. The seller can pay the discount points, or a
portion thereof, if you and the seller agree to
such an arrangement.
Don't Commit Loan Fraud
It is important for you to understand that you are
required to provide complete and accurate information
when applying for a mortgage loan.
a. Do not falsify information about your income or
assets.
b. Disclose all loans and debts (including money
that may have been borrowed to make the down
payment).
c. Do not provide false letters-of-credit, cash-onhand statements, and gift letters or sweat equity
letters.
d. Do not accept funds to be used for your down
payment from any other party (seller, real estate
salesperson, builder, etc.).
e. Do not falsely certify that a property will be used
for your primary residence when you are actually
going to use it as a rental property.
f. Do not act as a “strawbuyer” (somebody who
purchases a property for another person and
then transfers title of the property to that
person), nor should you give that person
personal or credit information for them to use in
any such scheme.
g. Do not apply for a loan by assuming the identity
of another person.
.

e. Mortgagees may agree to guarantee or "lock-in"
the loan terms for a definite period of time (i.e., 15,
30, 60 days, etc.) or may permit your loan to be
determined by future market conditions, also
known as "floating". Mortgagees may require a fee
to lock in the interest rate or the terms of the loan,
but must provide a written agreement covering a
minimum of 15 days before the anticipated closing.
f. Your agreement with the mortgagee will
determine the degree, if any, that the interest rate
and discount points may rise before closing.
g. If the mortgagee determines you are eligible for the
mortgage, your agreement with the seller may
require you to complete the transaction or lose
your deposit on the property.
h.

Do not sign an incomplete or blank
document; that is missing the name and
address of the recipient or other important
identifying information.

Penalties for Loan Fraud: Federal laws provide severe
penalties for fraud, misrepresentation, or conspiracy to
influence wrongly the issuance of mortgage insurance
by HUD. You can be subject to a possible prison term
and fine of up to $10,000 for providing false information.
Additionally, you could be prohibited from obtaining a
HUD-insured loan for an indefinite period.
Report Loan Fraud: If you are aware of any fraud in
HUD programs or if an individual tries to persuade you
to make false statements on a loan application, you
should report the matter by calling your nearest HUD
office or the HUD Regional Inspector General, or call
the HUD Hotline on 1 (800) 347-3735.
Warning: It is a crime to knowingly make false
statements to the United States Government on this or
any similar form. Penalties upon conviction can include
a fine and imprisonment. For details see: Title 18 U.S.
Code Section 1001 and Section 1010.

Discrimination
If you believe you have been subject to discrimination because of race, color, religion, sex, handicap, familial status,
or national origin, you should call HUD's Fair Housing & Equal Opportunity Complaint Hotline: 1 (800) 669-9777.
Previous editions are obsolete

Page 1 of 2

form HUD-92900-B (11/2014)

About Prepayment
This notice is to advise you of the requirements that
must be followed to accomplish a prepayment of your
mortgage, and to prevent accrual of any interest after
the date of prepayment.
You may prepay any or all of the outstanding indebtedness due under your mortgage at any time, without
penalty. However, to avoid the accrual of interest on
any prepayment, the prepayment must be received on
the installment due date (the first day of the month) if
the mortgagee stated this policy in its response to a
request for a payoff figure.
Otherwise, you may be required to pay interest on the
amount prepaid through the end of the month. The
mortgagee can refuse to accept prepayment on any
date other than the installment due date.
For all FHA mortgages closed on or after January 21,
2015, mortgagees may only charge interest through the
date the mortgage is paid in full.

FHA-to-FHA Refinance: When a FHA insured loan is
refinanced; the refund from the old premium may be
applied toward the upfront premium required for the
new loan.
How are Refunds Determined?
The FHA Commissioner determines how much of the
upfront premium is refunded when loans are terminated.
Refunds are based on the number of months the loan is
insured.
Monthly Insurance Premiums
In addition to an upfront mortgage insurance premium
(UFMIP), you may also be charged a monthly mortgage
insurance premium. You will pay the monthly premium
for either:


the first 11 years of the mortgage term, or the
end of the mortgage term, whichever occurs
first, if your mortgage had an original principal
obligation (excluding financed UFMIP) with a
loan-to-value (LTV) ratio of less than or equal to
90 percent; or



the first 30 years of the mortgage term, or the
end of the mortgage term, whichever occurs first,
for any mortgage involving an original principal
obligation (excluding financed UFMIP) with an
LTV greater than 90 percent.)

FHA Mortgage Insurance Information
Who may be eligible for a refund?
Premium Refund: You may be eligible for a refund of
a portion of the insurance premium if you paid an
upfront mortgage insurance premium at settlement and
are refinancing with another FHA mortgage.
Review your settlement papers or check with your
mortgage company to determine if you paid an upfront
premium.
Exceptions:
Assumptions: When a FHA insured loan is assumed
the insurance remains in force (the seller receives no
refund). The owner of the property at the time the
insurance is terminated is entitled to any refund.

Important: The rules governing the eligibility for premium refunds are based on the
financial status of the FHA insurance fund and are subject to change.
SI USTED HABLA ESPANOL Y TIENE DIFICULTAD LEYENDO O HABLANDO INGLES, POR FAVOR LLAME A
ESTE NUMERO TELEFONICO 800.697.6967.
You, the borrower, must be certain that you understand the transaction. Seek professional advice if you are
uncertain.
Acknowledgment: I acknowledge that I have read and received a copy of this notice at the time of loan application.
This notice does not constitute a contract or binding agreement. It is designed to provide current HUD/FHA policy
regarding refunds.
Signature & Date:

X

Signature & Date:

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Signature & Date:

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Previous editions are obsolete

Signature & Date:

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Page 2 of 2

form HUD-92900-B (11/2014)