But the terms of the loan cannot change. If you ever get a hello letter without a goodby letter from your old lender, it might be a scam, so call up to make sure your loan has actually been sold. You may not have known this, but your mortgage lender has you pegged as an A, B, C or even D risk. But lenders will still make loans to these people since they recognize the lack of payments may have been beyond their control. Make sure you shop around.
Lenders usually require the first years premium in advance at closing.
You can get the MI built into the interest rate for the loan and it's therefore tax deductible. But then there is no opportunity to cancel the MI in the future. And you usually would like to drop this as soon as possible. Most lenders will allow you to cancel the MI if you have been paying for two to five years. Actually these are the so called standard debt to income limits established by FHA in order to get a residential loan.