FHA Mortgage Insurance (MIP)
FHA mortgage insurance comes in two parts: a one-time upfront premium (UFMIP) of 1.75% of the loan, and an annual premium (MIP) of 0.50%–0.55% for most borrowers, paid monthly. On a $300,000 loan that is $5,250 upfront plus about $137 a month.
The catch that surprises many buyers: on FHA loans with less than 10% down, the annual MIP lasts the life of the loan. Put 10% or more down and it drops off after 11 years. Unlike conventional PMI, you cannot simply cancel it at 20% equity.
Current FHA MIP rates
Every FHA borrower pays the 1.75% upfront premium (which can be rolled into the loan). The annual premium then depends on your loan term, loan-to-value ratio and loan size. The rates below are for standard loans; larger “high-balance” loans pay up to 0.75%.
| Loan term | Down payment (LTV) | Annual MIP |
|---|---|---|
| Over 15 years | Under 5% (LTV > 95%) | 0.55% |
| Over 15 years | 5% or more (LTV ≤ 95%) | 0.50% |
| 15 years or less | 10% or more (LTV ≤ 90%) | 0.15% |
| 15 years or less | Under 10% (LTV > 90%) | 0.40% |
What FHA MIP costs
The upfront premium scales with the loan, and the monthly premium is the annual rate divided by twelve. Below is the cost for a typical 30-year loan at the common 0.55% annual rate.
| Loan amount | Upfront (1.75%) | Monthly MIP |
|---|---|---|
| $200,000 | $3,500 | $92 |
| $300,000 | $5,250 | $137 |
| $400,000 | $7,000 | $183 |
| $500,000 | $8,750 | $229 |
How long you pay MIP — and how to drop it
This is the biggest difference from conventional PMI. If you put less than 10% down, FHA annual MIP stays for the entire loan term. With 10% or more down, it cancels automatically after 11 years. There is no equity-based cancellation like conventional loans have at 78–80%.
The usual way to escape MIP is to refinance into a conventional loan once you have about 20% equity — that ends mortgage insurance entirely, provided your credit and the new rate make the refinance worthwhile. Use the calculators below to compare an FHA loan against a conventional one.
How much is FHA mortgage insurance?
A 1.75% upfront premium plus an annual premium of 0.50%–0.55% for most borrowers, paid monthly. On a $300,000 loan that is $5,250 upfront and roughly $137 per month.
How long do you pay FHA MIP?
With less than 10% down, for the life of the loan. With 10% or more down, it automatically ends after 11 years. Unlike conventional PMI, it cannot be cancelled just by reaching 20% equity.
How do I get rid of FHA MIP?
The standard route is to refinance into a conventional loan once you have about 20% equity, which removes mortgage insurance entirely. Otherwise, MIP stays for 11 years (10%+ down) or the full term (under 10% down).
What is the difference between MIP and PMI?
MIP is FHA mortgage insurance; PMI is the private insurance on conventional loans. MIP has an upfront fee and often lasts the life of the loan, while PMI has no upfront fee and cancels automatically at 78–80% loan-to-value.