FHA Loan Calculator: Estimate Your Monthly Payment
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Mortgages insured by the Federal Housing Administration require a smaller down payment and have lower closing costs.
Estimate your monthly FHA loan payment with our FHA mortgage calculator.
What is an FHA loan?
FHA loans are mortgages insured by the Federal Housing Administration, part of the U.S. Department of Housing and Urban Development. You don’t have to be a first-time home buyer to get an FHA loan. Many FHA loan requirements, such as credit scores, are more lenient than those of conventional loans, so they’re a popular choice for borrowers with limited savings or existing debt.
To qualify for the loan, the property must go through an FHA appraisal, which flags any necessary repairs. And if you make a down payment of less than 10%, you have to pay mortgage insurance for the life of the loan.
What does my monthly FHA mortgage payment include?
Our FHA loan payment calculator considers the following costs when estimating your monthly FHA loan payment:
Principal. This is the amount you owe on the loan, or what you borrowed minus your down payment. For example, if you buy a $250,000 home and put down 10% ($25,000), the principal would be $225,000.
Interest. This is the cost of borrowing the money from a lender, expressed as an annual percentage of the principal.
FHA mortgage insurance premium, or MIP. Mortgage insurance protects lenders from losing money if a borrower defaults on the loan. FHA loan requirements mandate mortgage insurance premiums. You’ll make an upfront payment at closing. Then, ongoing FHA mortgage insurance premiums are factored into your monthly payment.
Property taxes. Annual taxes on your home and land, assessed by a government authority, are often collected as a part of your payment and paid through an escrow account.
Homeowners insurance. This helps pay for damage if your home or belongings are damaged by an event covered under your policy. In certain instances, it can also pay your legal bills if you injure someone. When you have an FHA loan, your homeowners insurance is also paid through an escrow account.
With good credit, you can make a down payment as low as 3.5% on an FHA loan. But then you have to pay mortgage insurance for the life of the loan. Consider making a down payment of at least 10%. At this threshold, your mortgage insurance premiums will end after 11 years.
How can I lower my FHA mortgage payment?
If the numbers in your FHA loan payment calculation seem a bit high, there are ways to lower them:
Make a larger down payment. Putting more money down on the loan upfront will lower your monthly payments. If you don’t have the cash saved, see if you qualify for down payment assistance. Browse our list of first-time home buyer programs by state to find resources in your area.
Buy less house. A smaller loan means smaller payments. Maybe you can do with a "good enough" home to start and make improvements over the years. Get tips on what to do if you can’t find an affordable FHA-approved home.
Shop around for a better interest rate. Compare at least three FHA lenders to get the best shot at a lower interest rate. And mix up the competition: Consider lenders that are local, national and online-only.
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