FHA Loan Calculator
Estimate your FHA monthly payment, including upfront and annual mortgage insurance premium (MIP).
What is an FHA loan?
An FHA loan is a mortgage insured by the Federal Housing Administration, designed to make homeownership more accessible for buyers with lower down payments or less-than-perfect credit. FHA loans allow down payments as low as 3.5% for borrowers with qualifying credit scores, which is significantly lower than the 20% often assumed necessary for conventional loans. Because the government insures the loan against default, lenders can offer more flexible qualification standards.
What is FHA Mortgage Insurance Premium (MIP)?
Unlike conventional loans, FHA loans require mortgage insurance regardless of down payment size, split into two parts. An upfront MIP of 1.75% of the loan amount is charged at closing (and is typically rolled into the loan balance rather than paid in cash), plus an ongoing annual MIP of approximately 0.55% of the loan balance, divided into monthly payments. Unlike PMI on conventional loans, FHA's annual MIP often stays for the life of the loan if your down payment was under 10%, making it an important long-term cost to factor in.
Is an FHA loan right for you?
FHA loans are especially popular with first-time homebuyers who have limited savings for a down payment or a shorter credit history, since FHA guidelines are generally more forgiving than conventional loan requirements. The trade-off is the added cost of MIP, which can make an FHA loan more expensive over time than a conventional loan with PMI once your equity builds up. Use the calculator above to see your full estimated payment, including both parts of MIP, before deciding.
Frequently Asked Questions
What is the minimum down payment for an FHA loan?
FHA loans allow down payments as low as 3.5% of the home price for borrowers who meet the qualifying credit score requirements, making it one of the most accessible loan programs for buyers with limited savings.
What is FHA MIP and why do I have to pay it?
Mortgage Insurance Premium (MIP) protects the lender in case you default, and it's required on all FHA loans regardless of your down payment size. It has two parts: an upfront MIP (about 1.75% of the loan, usually financed into the loan) and an annual MIP (about 0.55% of the balance, paid monthly).
Does FHA MIP ever go away?
If your down payment was 10% or more, annual MIP is removed after 11 years. If your down payment was under 10%, annual MIP typically stays for the life of the loan unless you refinance into a conventional mortgage.
Is an FHA loan better than a conventional loan?
It depends on your credit profile and savings. FHA loans are often easier to qualify for with lower credit scores and smaller down payments, but the ongoing MIP can make them more expensive long-term than a conventional loan with PMI, which drops off once you reach 20% equity.
What credit score do I need for an FHA loan?
FHA guidelines generally allow credit scores as low as 580 for the 3.5% down payment option, and some lenders permit scores between 500-579 with a larger 10% down payment, though individual lender requirements can be stricter.
Is the upfront MIP paid in cash or added to my loan?
Most borrowers choose to finance (roll) the upfront MIP into their total loan amount rather than pay it in cash at closing, which slightly increases the loan balance and monthly payment but avoids an additional upfront cost.
Are there loan limits on FHA loans?
Yes, FHA loans have county-specific loan limits set annually by HUD, which are generally lower than conventional conforming loan limits in most areas, though higher-cost counties have higher FHA limits.
Can I use an FHA loan for a second home or investment property?
No, FHA loans are only available for primary residences. You must occupy the property as your main home, generally within 60 days of closing.