Bills · HR 5508
IN COMMITTEE· 119TH CONGRESS
House BillHR 5508Finance and Financial Sector
Mortgage Insurance Freedom Act
INTRO SEP 19· LAST ACTION SEP 19
READING
3MIN
COSPONSORS
4BIPARTISAN
READER REACTIONS0 TOTAL
NO VOTES YET · BE THE FIRST
- Introduced only
LEGISLATIVE PROGRESS
STEP 2 / 8Introduced
In Committee
Reported
Passed House
Passed Senate
Conference
To President
Became Law
WHAT THE BILL DOES
AI-writtenThis bill matters because it directly addresses a long-standing difference between FHA loans and conventional mortgages regarding mortgage insurance. Currently, FHA borrowers often have to pay annual mortgage insurance premiums for the entire duration of their loan, regardless of how much equity they build. This adds a significant ongoing cost to homeownership for many low-to-moderate income buyers who rely on FHA loans due to their lower down payment requirements or more flexible credit standards.
If this bill becomes law, it would bring FHA mortgage insurance rules closer to those of conventional loans, where private mortgage insurance (PMI) can typically be cancelled once a borrower reaches 20-22% equity. This change could make FHA loans more appealing and affordable, reducing the overall financial burden on homeowners and potentially freeing up funds for other expenses or savings. If it doesn't pass, FHA borrowers will continue to pay annual premiums for the life of their loan, keeping their monthly housing costs higher for longer.
KEY PROVISIONS
5AI-extractedPROVISION 01
Restricts the collection of annual FHA mortgage insurance premiums once the remaining loan balance is 78% or less of the home's original sales price or appraised value.
This allows FHA homeowners to eventually stop paying a significant recurring cost, saving them money over the life of their loan.
PROVISION 02
Includes an exception where premium collection can resume if the FHA's Mutual Mortgage Insurance Fund's capital ratio falls below 2%.
This provision acts as a safeguard to protect the financial health of the FHA's insurance fund, ensuring it can cover potential losses.
PROVISION 03
Requires the Department of Housing and Urban Development (HUD) to issue rules within 180 days to implement this change and create a process for homeowners to demonstrate their eligibility.
This ensures there is a clear and official way for homeowners to apply for the premium cancellation and for HUD to manage the new policy.
PROVISION 04
Mandates that HUD conduct outreach and educational activities to inform FHA mortgagors about this new restriction and the process to apply.
This ensures that homeowners are aware of their rights and how to take advantage of the premium cancellation, preventing them from missing out on potential savings.
PROVISION 05
Applies these changes only to FHA mortgages endorsed for insurance after the bill's enactment date.
This means that existing FHA homeowners will not benefit from these changes, limiting the immediate impact to future borrowers.
SPONSORSHIP
1 + 4
D· New York
YRS IN OFFICE
29
BILLS LED
44
COSPONSOR BREAKDOWNBIPARTISAN · 50%
DEM 3 REP 1 IND 0
ACTION TIMELINE
2 EVENTSSEP 19
Introduced in House
SEP 19
Referred to the House Committee on Financial Services.
BILL INFO
TypeHouse Bill
NumberHR 5508
Congress119th
StatusIn Committee
IntroducedSep 19, 2025
Last actionSep 19, 2025
READER REACTIONS
OVERALL SENTIMENT
No reactions yet. Be the first to weigh in.
Discussion
Loading comments...
IN COMMITTEE· 119TH CONGRESS · FINANCIAL SERVICES COMMITTEE · INTRODUCED SEP 19, 2025
House BillHR 5508Finance and Financial Sector
Mortgage Insurance Freedom Act
INTRODUCED SEP 19, 2025· LAST ACTION SEP 19, 2025
PASSAGE CHANCES
—%
READING
3 min
COSPONSORS
4
COMPLEXITY
Moderate
