The Mortgage Insurance Freedom Act would change the rules for mortgage insurance premiums on FHA-insured loans by stopping the collection of annual insurance premiums once a borrower's loan balance reaches 78 percent of the home's original sale price or appraised value. Currently, borrowers must pay mortgage insurance premiums for the life of the loan regardless of how much equity they build in their home. The bill applies only to new mortgages endorsed by the Department of Housing and Urban Development after the law takes effect, and includes an exception that allows premium collection to continue if the federal Mortgage Insurance Fund's financial reserves drop below 2 percent. HUD would have 180 days after the law passes to write rules establishing how borrowers can demonstrate they've reached the 78 percent threshold and qualify for premium relief. The department would also be required to conduct outreach to inform borrowers about this new benefit and the process for claiming it.