How to use the FHA loan calculator
- Enter the home price.
- Choose your credit score band: 580 or higher, or 500 to 579.
- Enter your down payment as a percentage. The minimum is 3.5% at 580 or higher and 10% at 500 to 579.
- Enter the interest rate and choose the loan term.
- Enter property tax and home insurance per year, and any HOA fees per month.
- Leave add the upfront MIP to the loan ticked if you'll finance it, as most borrowers do; untick it to pay it at closing.
- Read the first-year monthly payment, the MIP details and the year-by-year premium table.
How FHA mortgage insurance is calculated
Every FHA loan carries two premiums. The upfront premium (UFMIP) is 1.75% of the base loan, charged once. The annual premium is a yearly percentage paid in monthly installments.
The annual rate depends on the loan term, the base loan amount and the loan-to-value ratio (LTV, the base loan divided by the price). Following HUD's method, the premium for each year is the rate times the average of the 12 scheduled month-start balances of the base loan, so it falls slightly every year as you pay the loan down.
FHA annual MIP rates
| Term | Base loan | LTV | Annual MIP | Lasts |
|---|---|---|---|---|
| Over 15 years | $726,200 or less | 95% or less | 0.50% | 11 years if LTV ≤ 90%, else loan term |
| Over 15 years | $726,200 or less | over 95% | 0.55% | Life of the loan |
| Over 15 years | over $726,200 | 95% or less | 0.70% | 11 years if LTV ≤ 90%, else loan term |
| Over 15 years | over $726,200 | over 95% | 0.75% | Life of the loan |
| 15 years or less | $726,200 or less | 90% or less | 0.15% | 11 years |
| 15 years or less | $726,200 or less | over 90% | 0.40% | Life of the loan |
| 15 years or less | over $726,200 | 78% or less | 0.15% | 11 years |
| 15 years or less | over $726,200 | 78.01% to 90% | 0.40% | 11 years |
| 15 years or less | over $726,200 | over 90% | 0.65% | Life of the loan |
These rates come from HUD Mortgagee Letter 2023-05, in effect for loans endorsed from March 20, 2023, and still the current schedule in 2026. The upfront premium is 1.75% for all purchase loans. The minimum down payments (3.5% at a 580+ score, 10% at 500 to 579) come from HUD's single-family handbook. FHA loan limits vary by county and are updated by HUD each year, so check the limit for your area with your lender.
Worked example
The defaults are a $350,000 home with 3.5% down, a 6.25% 30-year loan, $3,850 property tax and $1,500 insurance a year:
- Down payment: 3.5% × 350,000 = $12,250, so the base loan is $337,750 and the LTV is 96.5%
- Upfront MIP: 1.75% × 337,750 = $5,910.63, giving a loan of $343,660.63
- Principal and interest: $2,115.98 a month
- Annual MIP rate: 0.55% (30 years, base loan under $726,200, LTV over 95%), for the life of the loan
- Average scheduled balance in year 1: $335,956.45, so monthly MIP = 0.0055 × 335,956.45 ÷ 12 = $153.98
- Tax and insurance: 3,850 ÷ 12 + 1,500 ÷ 12 = $320.83 + $125.00
- Monthly payment: 2,115.98 + 153.98 + 320.83 + 125.00 = $2,715.79
Put 10% down instead and the annual rate drops to 0.50%, MIP ends after 11 years, and the payment falls to $2,549.84. A 15-year term at the same rate costs $3,502.92 a month, but the annual premium drops to 0.40%.
FHA vs. conventional loans
FHA loans accept lower credit scores and small down payments, which makes them popular with first-time buyers. The trade-off is mortgage insurance that, with under 10% down, never drops off on its own. Conventional private mortgage insurance (PMI) is cancelled automatically once the balance is scheduled to reach 78% of the original value. If your credit is strong, compare both; the mortgage calculator handles a conventional loan with PMI. Many FHA borrowers refinance into a conventional loan once they have about 20% equity, which removes the MIP.
Frequently asked questions
How much is FHA mortgage insurance?
For most borrowers, 1.75% of the base loan up front plus 0.55% a year (or 0.50% with at least 5% down) on a 30-year loan. On a $337,750 base loan that is $5,910.63 up front and about $154 a month in the first year.
Can I remove MIP from an FHA loan?
Only if you put at least 10% down, in which case it ends after 11 years. With less than 10% down it lasts for the life of the loan, and the usual way out is to refinance into a conventional loan once you have enough equity.
What credit score do I need for an FHA loan?
HUD allows scores down to 500 with 10% down, and 580 or higher for the 3.5% minimum. Lenders often set their own, higher minimums, so check with several.
Why does my lender's MIP differ slightly?
Lenders work from the exact amortization schedule and round each year's premium, and some quote the first year using the full loan amount. Differences of a few dollars a month are normal; the rate itself should match the table above.
Related calculators
- Mortgage Calculator — Your full monthly housing cost, including property tax, insurance, PMI and HOA fees.
- VA Mortgage Calculator — VA home loan payment with the current VA funding fee, first or subsequent use, exemptions, taxes and insurance.
- Down Payment Calculator — Your down payment, loan, LTV and cash to close for a home price, or how long it will take to save the down payment.
- Home Affordability Calculator — How much house your income supports under the 28/36 rule, with your debts and down payment.
Results are estimates for educational purposes and are not financial, tax or legal advice. See our disclaimer.