We require non-refundable borrower paid single premium mortgage insurance. Our MI vendor advised we do not need to send out any annual notice about cancellation of the MI because the premium was paid up front and is non-refundable. This seems like bad advice. I am hoping that other banks that offer non-refundable single pay mortgage insurance would share what their practices are with respect to annual notices and their refund practices.

Thanks in advance.

Single premium or not, you are obligated to refund any unearned premiums when the loan meets the HOPA conditions. There is no difference between single premium MI and monthly MI when it comes to notification requirements or refunds.

Single premium MI is not real popular anymore, as it makes making a QM loan nearly impossible and also gives you a much narrower window to avoid making high-cost mortgages.