An FHA payment is principal and interest on the loan plus annual mortgage insurance (MIP) divided by 12. FHA also charges an upfront MIP of 1.75% of the base loan, which is usually added to the loan, and this calculator includes it. On a $300,000 home with 3.5% down, the base loan is $289,500, the upfront MIP is $5,066.25 and the loan is $294,566.25. At 6.25% for 30 years that is $1,813.70 for principal and interest plus $135.01 of MIP at 0.55%, or $1,948.70 a month before taxes and insurance.
First time buyers often use FHA programs for lower down payment options. Size cash needed with the down payment calculator, then refine full housing cost with the mortgage calculator. For another program, compare the VA mortgage calculator.
FHA annual MIP rates (terms over 15 years)
| Base loan amount | LTV 95% or less | LTV over 95% |
|---|---|---|
| $726,200 or less | 0.50% | 0.55% |
| Over $726,200 | 0.70% | 0.75% |
- Terms of 15 years or less: 0.15% or 0.40%.
- MIP lasts 11 years if the LTV is 90% or less; otherwise it lasts for the mortgage term.
Source: HUD Mortgagee Letter 2023-05, which uses $726,200 as the loan-amount threshold. HUD cut the annual MIP from 0.85% to 0.55% in its 2023 announcement.
FHA down payment and credit score
A credit score of 580 or higher qualifies for maximum financing (96.5% LTV, which means 3.5% down). Scores of 500–579 are limited to 90% LTV (10% down). Below 500 is not eligible. Sources: HUD Handbook 4155.1 4.A.1.c and the 3.5% minimum in HUD FHA Myths vs Facts.
FHA payment by price (3.5% down, 6.25%, 30 years, 0.55% MIP, upfront MIP financed)
| Price | Base loan | P&I | MIP/month | Total | Upfront MIP (1.75%) |
|---|---|---|---|---|---|
| $250,000 | $241,250 | $1,511.41 | $112.51 | $1,623.92 | $4,221.88 |
| $300,000 | $289,500 | $1,813.70 | $135.01 | $1,948.70 | $5,066.25 |
| $400,000 | $386,000 | $2,418.26 | $180.01 | $2,598.27 | $6,755.00 |
How the payment is built
Base loan = price × (1 – down_pct÷100). Upfront MIP = base × upfront_mip÷100 (1.75 by default). Loan = base + upfront MIP. Principal and interest = PMT(loan, rate, years×12). Monthly MIP = loan × mip÷100÷12. Estimated payment = principal and interest + monthly MIP.
Worked example
Price $300,000, down 3.5 percent, rate 6.25 percent, term 30 years, annual MIP 0.55 percent, upfront MIP 1.75 percent. Base = $300,000 − $10,500 = $289,500. Upfront MIP = $289,500 × 0.0175 = $5,066.25. Loan = $294,566.25. Principal and interest = PMT($294,566.25, 6.25%, 360) ≈ $1,813.70. Monthly MIP = $294,566.25 × 0.0055 ÷ 12 = $135.01. Total ≈ $1,948.70.
| Input | Value |
|---|---|
| Home price | $300,000 |
| Down payment % | 3.5% |
| Rate | 6.25% |
| Term | 30 years |
| Annual MIP % | 0.55% |
| Upfront MIP % | 1.75% (financed) |
| Loan with upfront MIP | $294,566.25 |
| Estimated payment | ~$1,948.70 |
Paying the upfront MIP in cash instead: set Upfront MIP % to 0. The loan stays at $289,500, principal and interest is $1,782.50, MIP is $132.69 and the payment is $1,915.19. That is $33.51 a month less, but you need $5,066.25 more cash at closing.
10% down on $300,000: base $270,000, LTV 90%, so annual MIP is 0.50% and lasts 11 years. With the $4,725 upfront MIP financed, the loan is $274,725 and the payment is $1,806.00 (at 0.55% it would be $1,817.44).
How to use the fields
- Home price is the purchase price before credits.
- Down payment % lowers the base loan immediately.
- Interest rate is the note rate used in PMT.
- Term years sets the amortization length.
- Annual MIP % drives the monthly insurance add on in this model: 0.55% for most 3.5% down loans; 0.50% at 5% down or more.
- Upfront MIP % is 1.75% for most FHA loans and is added to the loan. Enter 0 if you pay it in cash at closing.
What this leaves out
Property taxes, homeowners insurance, HOA dues, and closing costs are not in the result. The upfront MIP (1.75% of the base loan) is in it: the calculator adds it to the loan, as most borrowers do, so the loan is higher than price minus down payment.
Comparing scenarios
Hold price fixed and change only rate, then only MIP, then only down percent. That isolates which quote difference matters most for monthly cash flow.
Common mistakes
- Treating the result as full PITI with taxes and insurance
- Entering monthly MIP as if it were the annual percent field
- Forgetting seller credits that change cash to close but not this base formula
- Ignoring that condo or property rules can block FHA approval
Cash to close reminder
- Down payment cash is price × down percent.
- Closing costs need a separate estimate: lender fees, title, prepaid items, and inspection costs. Add that list to down payment cash, because a payment that fits monthly still fails if cash to close is short.
- Reserves may still be required after closing.
On your Loan Estimate, the loan amount usually includes the financed upfront MIP ($294,566.25 in the example). If it differs from the calculator, check the down payment and the Upfront MIP % you entered.
Down payment and MIP interaction
Raising down payment percent lowers the base loan and therefore lowers both principal and interest and the MIP add on in this model. Run 3.5 percent and a higher percent on the same price to see whether extra cash at closing buys a meaningful monthly change.
Some borrowers prefer to keep cash for repairs even if the payment is slightly higher. Model both paths with realistic repair budgets so the choice is explicit.
Property eligibility
FHA rules can limit condo projects, fixers, and flip timelines. If FHA is not the right fit, compare limits and mortgage insurance in FHA vs conventional. A perfect payment estimate does not help if the property is ineligible. Confirm property rules early so you do not spend inspection money on a dead end.
Pair this payment with a full budget that includes taxes and insurance quotes for the specific address. Escrow can dwarf small MIP differences.
Limitations
Program overlays, credit tiers, and exact MIP schedules change. This page is a planning estimate, not an underwriting decision. Confirm figures on your official disclosures before you lock a rate. Some owners plan to refinance out of FHA later, but that is uncertain, so size a payment you can carry without it.