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FHA Loan Calculator

Calculate FHA loan payments with MIP (mortgage insurance premium).

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The FHA Loan Calculator shows how much you will pay for an FHA-insured mortgage, including mortgage insurance premiums (MIP) and comparing to conventional loans. FHA loans are designed for first-time homebuyers and borrowers with lower credit scores, requiring only 3.5% down. Understand the true cost of MIP, which is higher than conventional PMI but may be worth it for easier qualification.

Enter the home price, your down payment (minimum 3.5% for FHA), interest rate, and loan term. The calculator shows your monthly payment including mortgage insurance, the upfront MIP cost, and a comparison with conventional loan costs.

Examples

FHA Loan with 3.5% Down on a $300,000 Home

You purchase a $300,000 home with 3.5% down ($10,500). The base loan is $289,500, and the upfront MIP of 1.75% ($5,066) is financed into the loan for a total of $294,566. At 6.5% interest for 30 years, your monthly P&I is about $1,862, plus $165/month in annual MIP, for a total payment around $2,027.

FHA Loan with 10% Down on a $225,000 Home

You put 10% down ($22,500) on a $225,000 home, borrowing $202,500. The upfront MIP adds $3,544, making the total loan $206,044. At 6.0% for 30 years, monthly P&I is approximately $1,235. With a lower annual MIP rate for higher down payments, your MIP drops to about $84/month, totaling roughly $1,319/month.

Frequently Asked Questions

What is the FHA minimum down payment?
FHA loans require a minimum 3.5% down payment with a credit score of 580 or higher. Borrowers with scores between 500-579 must put down at least 10%.
How long do I pay MIP on an FHA loan?
For loans with less than 10% down, MIP lasts the entire loan term. For 10% or more down, MIP can be removed after 11 years. The upfront MIP (1.75%) is a one-time charge typically financed into the loan.
FHA vs Conventional - which is better?
FHA loans are often better for buyers with lower credit scores or smaller down payments due to more lenient requirements. However, the ongoing MIP cost can make FHA more expensive over time compared to conventional loans where PMI drops off at 78% LTV.
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Quick Tips

  • •FHA loans are excellent for first-time homebuyers because they allow lower down payments (3.5%) and accept lower credit scores.
  • •Put down 10% or more if you plan to keep the mortgage long-term. The lifetime MIP cost for 3.5% down can exceed $50,000 on a $300,000 loan.
  • •Compare lifetime MIP costs with conventional PMI. PMI drops at 78% LTV with conventional loans; FHA MIP does not (unless 10%+ down).
  • •Your credit score affects your interest rate offer significantly. Even a 40-point difference in credit score can mean 0.5-1% higher rates.
  • •FHA loans require an appraisal and property inspections to ensure the home meets minimum property standards. Factor this into closing costs.

The FHA Loan Calculator shows how much you will pay for an FHA-insured mortgage, including mortgage insurance premiums (MIP) and comparing to conventional loans. FHA loans are designed for first-time homebuyers and borrowers with lower credit scores, requiring only 3.5% down. Understand the true cost of MIP, which is higher than conventional PMI but may be worth it for easier qualification.

How to Use This Calculator

Enter the home price, your down payment (minimum 3.5% for FHA), interest rate, and loan term. The calculator shows your monthly payment including mortgage insurance, the upfront MIP cost, and a comparison with conventional loan costs.

Understanding the Formula

Upfront MIP = Base Loan x 1.75% (financed into loan). Annual MIP = Base Loan x MIP Rate / 12. Monthly Payment = P&I on (Base Loan + Upfront MIP) + Monthly MIP. P&I = L[r(1+r)^n] / [(1+r)^n - 1].

Examples

FHA Loan with 3.5% Down on a $300,000 Home

You purchase a $300,000 home with 3.5% down ($10,500). The base loan is $289,500, and the upfront MIP of 1.75% ($5,066) is financed into the loan for a total of $294,566. At 6.5% interest for 30 years, your monthly P&I is about $1,862, plus $165/month in annual MIP, for a total payment around $2,027.

FHA Loan with 10% Down on a $225,000 Home

You put 10% down ($22,500) on a $225,000 home, borrowing $202,500. The upfront MIP adds $3,544, making the total loan $206,044. At 6.0% for 30 years, monthly P&I is approximately $1,235. With a lower annual MIP rate for higher down payments, your MIP drops to about $84/month, totaling roughly $1,319/month.

Frequently Asked Questions

What is the FHA minimum down payment?

FHA loans require a minimum 3.5% down payment with a credit score of 580 or higher. Borrowers with scores between 500-579 must put down at least 10%.

How long do I pay MIP on an FHA loan?

For loans with less than 10% down, MIP lasts the entire loan term. For 10% or more down, MIP can be removed after 11 years. The upfront MIP (1.75%) is a one-time charge typically financed into the loan.

FHA vs Conventional - which is better?

FHA loans are often better for buyers with lower credit scores or smaller down payments due to more lenient requirements. However, the ongoing MIP cost can make FHA more expensive over time compared to conventional loans where PMI drops off at 78% LTV.

Assumptions & Limitations

  • Credit score is 580 or higher; borrowers with scores 500-579 require 10% down; FHA has specific credit and income eligibility requirements.
  • Upfront MIP (1.75%) is financed into the loan; actual rates may vary with down payment amount.
  • Annual MIP rates are simplified; actual rates depend on loan-to-value (LTV) ratio and loan term, varying from 0.15% to 0.85%.
  • For loans with less than 10% down, MIP lasts the full loan term (cannot be removed). For 10%+ down, MIP can be removed after 11 years.
  • FHA does not allow seller concessions beyond 6% of purchase price; other financing rules and property requirements apply.