If you refi you FHA sponsored loan, then FHA give you a refund, but that practice might be ending because the program is in financial trouble.
One possibility is that the FHA will opt to apply what it owes borrowers to the outstanding principal of their new loans. Or refunds could be credited against the closing costs of a new loan at settlement rather than mailed in a check at a later date.
Either of those scenarios could be helpful, especially because refunds may be substantial.
Say, for example, that you took out a $500,000 mortgage in California last February. Back then, the upfront insurance premium for an FHA mortgage was 2.25%, so you paid $11,250 in advance for the privilege of having Uncle Sam protect your lender in case your mortgage went into default.
Let's just end FHA and resume traditional lending that existed before the bubble.Read it all