🏡FHA Loan Calculator
Calculate your FHA loan payments with mortgage insurance. Perfect for first-time buyers with smaller down payments.
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Frequently Asked Questions
What is an FHA loan and who qualifies?
An FHA loan is a mortgage insured by the Federal Housing Administration, designed for first-time buyers and those with lower credit scores or smaller down payments. You need a 580+ credit score for 3.5% down, or 500-579 for 10% down. FHA loans allow debt-to-income ratios up to 43% (sometimes 50%), making them more accessible than conventional loans. However, you must live in the home as your primary residence and meet property standards.
How much is FHA mortgage insurance and can I remove it?
FHA requires two types of mortgage insurance: (1) Upfront MIP of 1.75% of the loan (financed into the loan), and (2) Annual MIP of 0.55-1.05% of the loan paid monthly. For loans with less than 10% down, MIP lasts for the life of the loan and can only be removed by refinancing to conventional. For 10%+ down on 15-year or less terms, MIP ends after 11 years. This makes FHA more expensive long-term than conventional loans.
What are the advantages of an FHA loan?
FHA loans offer several benefits: (1) Low down payment - as little as 3.5%; (2) Lower credit score requirements (580 vs 620+ for conventional); (3) More flexible debt-to-income ratios; (4) Lower interest rates than conventional for those with lower credit; (5) Assumable loans - buyers can assume your FHA loan; (6) Down payments can be gifts from family. These make FHA ideal for first-time buyers or those with credit challenges.
What are the disadvantages of FHA loans?
FHA loans have drawbacks: (1) Lifetime MIP if you put down less than 10%; (2) Upfront 1.75% MIP fee added to loan; (3) Property must meet FHA standards (can limit choices); (4) Loan limits ($498,257 in most areas); (5) More expensive long-term than conventional due to MIP; (6) More paperwork and stricter appraisal requirements. If you can save 20% down and have 620+ credit, conventional is usually better.
Should I choose FHA or conventional loan?
Choose FHA if: you have less than 20% down, credit score 580-680, or debt-to-income ratio over 43%. Choose conventional if: you have 20%+ down (avoids PMI), 680+ credit score, and want to eliminate mortgage insurance eventually. FHA costs more over time due to lifetime MIP, but helps you buy sooner. Many buyers use FHA initially, then refinance to conventional after building equity and improving credit. Run the numbers for both options.
Financial Disclaimer
This calculator is provided for educational and informational purposes only. The results are estimates based on the information you provide and should not be considered as financial, legal, or tax advice.
Actual results may vary based on your specific circumstances, market conditions, and other factors. Always consult with qualified financial, legal, and tax professionals before making any financial decisions.
We make no guarantees about the accuracy, completeness, or reliability of the calculations. Use this tool at your own risk.