FHA Mortgage Payment Calculator
Estimates your total monthly FHA loan payment, including principal, interest, and mandatory mortgage insurance premium (MIP). Ideal for first-time buyers exploring low-down-payment options.
About this calculator
An FHA loan requires a minimum 3.5% down payment, making it popular for first-time homebuyers. The monthly payment has two components: the standard amortized principal-and-interest payment, plus a monthly mortgage insurance premium (MIP). The amortized payment formula is: P&I = L × [r(1+r)ⁿ] / [(1+r)ⁿ − 1], where L is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of payments (loan term in years × 12). The MIP portion is: MIP_monthly = L × (annualMIPRate / 12). Adding both gives your full monthly obligation. FHA's annual MIP currently ranges from 0.45% to 1.05% depending on loan size and term.
How to use
Suppose you buy a $300,000 home with 3.5% down at 6.5% interest over 30 years, with a 0.85% annual MIP. Loan amount L = $300,000 × (1 − 0.035) = $289,500. Monthly rate r = 6.5/100/12 = 0.005417. n = 360. P&I = $289,500 × [0.005417 × (1.005417)³⁶⁰] / [(1.005417)³⁶⁰ − 1] ≈ $1,830. Monthly MIP = $289,500 × 0.0085 / 12 ≈ $205. Total monthly payment ≈ $1,830 + $205 = $2,035.
Frequently asked questions
What is the FHA mortgage insurance premium rate and how long do I pay it?
For most 30-year FHA loans with less than 10% down, the annual MIP is 0.85% of the loan balance. This premium is divided into 12 monthly installments added to your payment. If your down payment is less than 10%, you pay MIP for the life of the loan. Putting down 10% or more reduces the MIP period to 11 years.
How does an FHA loan monthly payment compare to a conventional loan payment?
FHA loans typically carry lower interest rates than conventional loans for borrowers with lower credit scores, but the mandatory MIP adds a significant monthly cost. A conventional loan with 20% down has no private mortgage insurance (PMI) at all. For borrowers who can put down 20%, a conventional loan is usually cheaper per month. FHA becomes advantageous when you have limited savings or a credit score below 680.
When does it make sense to use an FHA loan instead of a conventional mortgage?
FHA loans are most beneficial when your credit score is between 580 and 679, since conventional lenders charge steep rate premiums in that range. They are also useful when you only have 3.5% saved for a down payment. If you have strong credit (720+) and 5% or more to put down, a conventional loan will usually cost less due to the absence of lifetime MIP. First-time buyers with limited credit history are the primary audience for FHA financing.