FHA Loan MIP Calculator
FHA loans are insured by the Federal Housing Administration (FHA), a division of HUD, and require mortgage insurance premiums to fund the FHA's insurance reserve. Every FHA borrower pays an upfront MIP of 1.75% of the base loan amount at closing (which can be financed into the loan) plus an annual MIP charged monthly. The annual rate depends on the loan term, LTV ratio, and loan size. This calculator shows both costs and the total MIP you will pay over the life of the loan under the 2024 HUD rate schedule.
FHA MIP formula
UFMIP = Base Loan * 0.0175
Financed Loan = Base Loan + UFMIP
Annual MIP Rate: 0.55% (30yr, LTV > 90%, loan <= $726,200)
Monthly MIP = Financed Loan * Annual Rate / 12
Monthly P+I = Amortization of Financed Loan at mortgage rate
Note: Annual MIP rates are set by HUD and vary by term, LTV, and loan limit. The 0.55% rate shown applies to standard 30-year loans with LTV above 90% and loan amounts at or below the 2024 conforming limit. Check the current HUD mortgagee letter for all rate tiers.
FHA MIP key facts
- Upfront MIP: 1.75% of base loan amount, due at closing or financed into the loan.
- Annual MIP: charged monthly as a percentage of the outstanding balance.
- LTV above 90%: annual MIP runs for the life of the loan (no automatic cancellation).
- LTV at or below 90% (down payment 10% or more): annual MIP cancels after 11 years.
- To avoid permanent MIP, some borrowers refinance to a conventional loan once they reach 20% equity.
FHA MIP: frequently asked questions
What is FHA mortgage insurance premium (MIP)?
FHA loans require two types of mortgage insurance: an upfront MIP (UFMIP) paid at closing or financed into the loan, and an annual MIP paid monthly. MIP protects the FHA (not the borrower) against lender losses if the borrower defaults.
How much is the upfront MIP?
For most FHA loans, the upfront MIP is 1.75% of the base loan amount. You can pay it in cash at closing or finance it into the loan, which increases the loan balance and the monthly payment slightly.
How is the annual MIP rate determined?
HUD sets the annual MIP rate based on the loan-to-value ratio, the loan amount, and the loan term. For loans above 15 years with LTV above 90%, the rate is typically 0.55% per year of the outstanding balance (as of 2024). Rates vary; check the current HUD mortgagee letter for exact rates.
Can FHA annual MIP be removed?
For FHA loans with a down payment of less than 10% (LTV above 90%), annual MIP remains for the life of the loan. For down payments of 10% or more (LTV at or below 90%), MIP cancels after 11 years. This is a key difference from conventional PMI.
Does financing the UFMIP increase my loan balance?
Yes. If you finance the 1.75% UFMIP, your loan balance increases by that amount. For a $300,000 base loan, the UFMIP is $5,250, making the financed balance $305,250. This slightly increases your monthly payment and the annual MIP calculation.
Official sources
- HUD: FHA Single Family Housing.
- Consumer Financial Protection Bureau: What is FHA mortgage insurance?
Reviewed by the CalculatorHub team, edited by James Graham, 15 June 2026. See our methodology.