FHA vs Conventional Loan Calculator
Compare monthly payments, mortgage insurance (FHA MIP vs. Conventional PMI), upfront funding fees, and total 30-year borrowing costs side by side.
Saves approximately $2,716 over 10 years because Conventional PMI automatically cancels after 10.3 years.
FHA Loan
Government Insured (HUD/FHA)
Conventional Loan
Conforming (Fannie / Freddie)
Mortgage Assumptions
Deciding Between an FHA Loan and a Conventional Mortgage
Choosing between an FHA loan backed by the Federal Housing Administration and a conforming Conventional mortgage backed by Fannie Mae or Freddie Mac is one of the highest-stakes financial decisions for homebuyers. While FHA allows lower credit scores and 3.5% down payments, its 1.75% Upfront Mortgage Insurance Premium (UFMIP) and non-cancellable annual MIP often make Conventional loans tens of thousands of dollars cheaper over 5 to 10 years.
Comprehensive Features
Side-by-Side Financial Comparison
Direct side-by-side comparison of down payments, loan balances, monthly mortgage insurance, and total payments.
FHA 1.75% Upfront MIP Financed
Accurately models the mandatory 1.75% Upfront Mortgage Insurance Premium rolled into the base loan.
PMI Cancellation at 80% / 78% LTV
Demonstrates the automatic drop-off of Conventional PMI under the Homeowners Protection Act of 1998.
Life-of-Loan FHA MIP Rule
Applies the post-2013 rule where FHA MIP remains for the full 30-year term if putting down less than 10%.
Credit Score Pricing Adjustments
Factors in Fannie Mae Loan-Level Price Adjustments (LLPAs) that affect Conventional interest rates.
Break-Even Horizon Analysis
Pinpoints the exact month where Conventional financing overtakes FHA in cumulative savings.
Practical Real-World Scenarios
- ✓Credit Scores Between 580 and 680
Identify whether FHA's lenient government pricing outperforms high Conventional LLPAs and steep PMI rates.
- ✓3% to 5% Down Payment Buyers
Compare Conventional HomeReady / HomePossible (3% down) against standard FHA (3.5% down).
- ✓Long-Term Homeowners (7+ Years)
Avoid the trapped cost of lifetime FHA MIP by qualifying for cancellable Conventional PMI.
- ✓FHA-to-Conventional Refinance Analysis
Calculate monthly savings from refinancing out of an existing FHA loan once home equity hits 20%.
Frequently Asked Questions
Can you get rid of mortgage insurance on an FHA loan?
For FHA loans originated after June 2013 with less than 10% down payment, annual MIP cannot be removed for the entire life of the 30-year loan. The only way to eliminate MIP is to refinance into a Conventional loan once you accumulate 20% equity.
When does private mortgage insurance (PMI) drop off a Conventional loan?
Under the federal Homeowners Protection Act, you can request PMI cancellation when your mortgage balance reaches 80% of the original property value, and the lender must automatically cancel PMI when the loan amortizes to 78% Loan-to-Value (LTV).
What is the minimum credit score for FHA vs Conventional?
FHA allows down payments of 3.5% with a credit score as low as 580 (or 10% down with 500-579). Conventional conforming loans typically require a minimum credit score of 620, with optimal PMI rates reserved for borrowers with scores of 740+.
What is the upfront mortgage insurance premium on an FHA loan?
FHA charges an Upfront Mortgage Insurance Premium (UFMIP) equal to 1.75% of the base loan amount. On a $400,000 loan, this adds $7,000 to the mortgage balance at closing.
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