FHA Loan Calculator
Calculate FHA loan payments including upfront and annual mortgage insurance premiums (MIP). Compare FHA vs conventional loans with PMI for first-time homebuyers.
Total Monthly Payment
$1,952.95
P&I: $1829.11 + MIP: $123.84
Base Loan
$270,200
Upfront MIP (1.75%)
$4,729
Total Loan Amount
$274,929
Total MIP Paid
$44,583
About the FHA Loan Calculator
An FHA loan calculator computes your complete monthly payment for a Federal Housing Administration-insured mortgage, including both the upfront mortgage insurance premium (1.75% of the loan, financed into the loan) and the ongoing annual MIP (0.55% for most loans in 2025), as well as the principal and interest payment. FHA loans are the primary home purchase vehicle for first-time buyers with lower down payments (minimum 3.5%) and credit scores as low as 580. In 2024, FHA insured approximately 1.1 million mortgages — roughly 15-20% of all US purchase loans. The appeal is accessible qualification standards; the cost is mandatory mortgage insurance that is both upfront and ongoing. Our calculator shows the complete FHA payment picture, models how different down payment percentages affect MIP duration and total cost, and provides the critical comparison point: when does it make financial sense to refinance an FHA loan to a conventional mortgage to eliminate the ongoing MIP? The calculator works specifically for US FHA-insured mortgages governed by HUD guidelines.
Formula
Upfront MIP = base loan × 1.75% | Total loan = base + upfront MIP | Monthly P&I = amortize total loan | Monthly MIP = (base loan × 0.55%) / 12 | MIP duration: life of loan if <10% down
How It Works
FHA loan structure: Step 1: Down payment = Home price × down%. Base loan = Home price - Down. Step 2: Upfront MIP = Base loan × 1.75%, financed into the loan. Total loan = Base loan + Upfront MIP. Step 3: Monthly P&I: standard amortization on Total loan at the stated interest rate for the loan term. Step 4: Monthly MIP = (Base loan × 0.55%) / 12. Note: MIP is calculated on the original base loan balance in the simplified model. Step 5: Total monthly payment = P&I + Monthly MIP + Property tax + Insurance (latter two entered separately). Example: $280,000 home, 3.5% down ($9,800), 7% rate, 30-year term. Base loan = $270,200. Upfront MIP = $270,200 × 1.75% = $4,729. Total loan = $274,929. Monthly P&I = $274,929 × [0.005833 × (1.005833)^360] / [(1.005833)^360 - 1] = $1,829. Monthly MIP = ($270,200 × 0.0055) / 12 = $123.84. Total (P&I + MIP) = $1,953. MIP duration: with 3.5% down (below 10%), MIP lasts the life of the loan — 360 months. Total MIP cost = $123.84 × 360 = $44,582.
Tips & Best Practices
- ✓With less than 10% down, FHA MIP never cancels automatically — it lasts the full 30 years. Once you reach 20% equity (typically after 7-10 years of appreciation and paydown), refinancing to a conventional loan eliminates MIP and often produces savings of $100-200/month.
- ✓The breakeven on refinancing from FHA to conventional: if refinancing saves $150/month in eliminated MIP but costs $6,000 in closing costs: $6,000 / $150 = 40 months (3.3 years) to break even. Model this when planning your refinance timeline.
- ✓FHA credit score minimums: 580+ for 3.5% down. 500-579 for 10% down. But most lenders impose overlays requiring 620+. Shopping FHA-specialized lenders (often smaller banks and credit unions) can find those who will go to 580 with clean payment history.
- ✓FHA loan limits vary by county: in high-cost areas (NYC, LA, SF), FHA limits in 2025 reach $1,089,300 for a single-family home. Standard single-family limit is $498,257. Check your county limit before assuming FHA covers your purchase price.
- ✓FHA Streamline Refinance: if you have an FHA loan and rates drop, the FHA Streamline program offers faster refinancing with minimal documentation and no appraisal requirement. This makes lowering your rate and monthly payment easier than a full conventional refinance.
- ✓Down payment assistance programs often stack with FHA: many state housing finance agencies provide 3-5% grants or soft second loans for down payments and closing costs, effectively enabling 0% out-of-pocket FHA purchases for qualified first-time buyers.
Who Uses This Calculator
First-time homebuyers with limited down payment savings evaluating FHA loan affordability. Buyers with 580-679 credit scores comparing FHA versus conventional loan total costs. Homeowners with existing FHA loans modeling when to refinance to conventional to eliminate MIP. Mortgage lenders and brokers illustrating the full FHA payment structure to clients. Financial counsellors helping clients evaluate FHA against other low-down-payment programs.
Optimised for: USA · Calculations run in your browser · No data stored
Frequently Asked Questions
What is the FHA upfront mortgage insurance premium?
FHA charges an upfront MIP of 1.75% of the base loan amount, financed into the loan. On a $300,000 FHA loan: $5,250 upfront MIP is added to the loan, making total loan $305,250.
What is the FHA annual MIP rate in 2025?
For most FHA loans in 2025, the annual MIP is 0.55% for loans under $726,200 with ≥10% down, and 0.55% for loans >$726,200. Annual MIP is paid monthly at 1/12 of the annual rate.
When can I remove FHA MIP?
For FHA loans with 10%+ down: MIP cancels after 11 years. For loans with less than 10% down: MIP lasts for the life of the loan — a major reason why refinancing to conventional once you reach 20% equity is often financially advisable.
What is the minimum down payment for an FHA loan?
FHA minimum is 3.5% down for borrowers with credit scores of 580+. Borrowers with scores of 500-579 must put down 10%. There is no 3.5% option below a 580 credit score.
FHA vs conventional loan: which is better?
FHA is better if your credit score is below 680 or you have limited down payment. Conventional is better with 620+ credit and 5-20% down because PMI (if needed) is typically cheaper than FHA MIP and cancels automatically at 80% LTV.