Upfront MIP fee will be increased from 1.75 to 2.25 MIP is a form of insurance thats supposed to fund HUDs reserves to purcahse foreclosed properties from lenders (thats where HUD Homes come from). ... For many Michigan Homebuyers, coming up with their down payment is the most challengign element of buying a home. On amny transactions, a 6 seller contribution will cover the required cloisng costs, prepaids prorations, requiring a homebuyer to only bring the 3.5 ...