FHA Mortgage Insurance Premiums (MIP) for 2026: Rates, Costs, and How Long You Pay
FHA mortgage insurance has two parts. You pay an upfront premium of 1.75% of your base loan amount, which most buyers add to the loan. You also pay an annual premium that is split into 12 monthly payments. On a 30-year loan up to $726,200, the annual rate is 0.50% if you put down at least 5% and 0.55% if you put down less. With at least 10% down, you pay the annual premium for 11 years. With less than 10% down, you pay it for the life of the loan unless you refinance. These are the rates in HUD’s most recent premium schedule, Mortgagee Letter 2023-05, and as of November 2026 we have not found a newer HUD notice that changes them.
Here is how each premium works, what the full rate table looks like, and how to plan for the cost.
What Is FHA Mortgage Insurance?
FHA mortgage insurance is a fee that pays for the federal insurance behind your loan. Think of it like a safety deposit for your lender. If a borrower stops paying and the home is lost, the insurance helps cover the lender’s loss. That safety net is why FHA lenders can approve buyers with smaller down payments and flexible credit rules.
The insurance protects your lender, not you. It is called the mortgage insurance premium, or MIP. It is not the same as private mortgage insurance, or PMI, which applies to conventional loans. For the full picture of FHA rules, see our FHA loan guidelines and our FHA loans page.
The upfront premium is a one-time fee of 1.75% of your base loan amount. The base loan amount is the loan before the premium is added. On a $200,000 base loan, it comes to $3,500.
Most buyers do not pay it in cash at closing. They add it to the loan, so the loan amount grows by the amount of the premium. That means you pay interest on it, but you keep more cash in your pocket on closing day. Here are two samples of how the numbers work:
FHA Loan Example (3.5% down, 30-year fixed rate): $300,000 sales price, $10,500 down payment, $294,566 loan amount (includes $5,066 FHA upfront mortgage insurance premium), 7.500% interest rate, 7.623% Annual Percentage Rate, $2,060 principal and interest payment.
FHA Loan Example (10% down, 30-year fixed rate): $300,000 sales price, $30,000 down payment, $274,725 loan amount (includes $4,725 FHA upfront mortgage insurance premium), 7.500% interest rate, 7.631% Annual Percentage Rate, $1,921 principal and interest payment.
The annual premium is a percentage of your loan balance. FHA charges it once a year, but you pay it in 12 equal parts added to your monthly mortgage payment. Three things set your rate: your loan amount, your loan term, and your loan-to-value ratio. Loan-to-value is your loan divided by your home’s value, so a bigger down payment means a lower ratio. FHA’s rates do not change with your credit score.
Here are the 2026 annual rates for loans with a term of more than 15 years, which covers the 30-year loans most buyers choose:
| Base Loan Amount | Loan-to-Value | Down Payment (About) | Annual Premium | How Long |
|---|---|---|---|---|
| Up to $726,200 | 90% or lower | 10% or more | 0.50% | 11 years |
| Up to $726,200 | Over 90% up to 95% | 5% to under 10% | 0.50% | Life of the loan |
| Up to $726,200 | Over 95% | Under 5% | 0.55% | Life of the loan |
| Over $726,200 | 90% or lower | 10% or more | 0.70% | 11 years |
| Over $726,200 | Over 90% up to 95% | 5% to under 10% | 0.70% | Life of the loan |
| Over $726,200 | Over 95% | Under 5% | 0.75% | Life of the loan |
Loans with a term of 15 years or less cost less:
| Base Loan Amount | Loan-to-Value | Annual Premium | How Long |
|---|---|---|---|
| Up to $726,200 | 90% or lower | 0.15% | 11 years |
| Up to $726,200 | Over 90% | 0.40% | Life of the loan |
| Over $726,200 | 78% or lower | 0.15% | 11 years |
| Over $726,200 | Over 78% up to 90% | 0.40% | 11 years |
| Over $726,200 | Over 90% | 0.65% | Life of the loan |
These figures come from HUD Mortgagee Letter 2023-05, which applies to loans that were endorsed on or after March 20, 2023. Your lender can confirm the exact rate for your loan.
How Long Do You Pay FHA Mortgage Insurance?
The length depends on your down payment, not your timeline. Here is the rule in one place:
- 10% or more down. You pay the annual premium for 11 years, then it ends.
- Less than 10% down. You pay the annual premium for the life of the loan.
If you start with 3.5% down, the premium does not end when you reach 20% equity. The way to end it is to refinance or pay off the loan. This is the biggest difference from conventional loans, where mortgage insurance can be canceled at a set equity level.
What Changed in 2023?
HUD lowered the annual premiums in March 2023. The cut was about 0.30 percentage points. For a 30-year loan up to $726,200 with less than 5% down, the annual rate dropped from 0.85% to 0.55%. The older 0.85% figure still appears in some outdated guides, so check the date on anything you read. The 1.75% upfront premium did not change.
FHA Mortgage Insurance vs. Conventional PMI
Both protect the lender. They work differently in a few key ways:
| Feature | FHA Mortgage Insurance | Conventional PMI |
|---|---|---|
| What sets the cost | Loan size, term, and loan-to-value | Varies by lender and insurer |
| Ends when | 11 years with 10% or more down; otherwise refinance or payoff | You can request cancellation at 80% of the home’s original value, and it ends automatically at 78% |
| Credit score affects it | No | Often yes |
Federal law sets the cancellation rule for monthly conventional PMI. The FDIC’s guide to the Homeowners Protection Act explains it. To see how conventional mortgage insurance works, read our private mortgage insurance guide.
How to Get Rid of FHA Mortgage Insurance
You have a few paths, and each one has tradeoffs:
- Put down 10% or more. The premium then ends after 11 years.
- Refinance into a conventional loan. Once you have enough equity, a conventional loan may let you drop mortgage insurance. Our guide on whether you should refinance your mortgage shows how to weigh the costs.
- Sell or pay off the loan. Either one ends the premium.
A refinance has its own closing costs, and your new rate may be higher or lower than your current one. Run the numbers before you decide.
Ways to Avoid or Lower Mortgage Insurance
You do not have to use FHA to buy with a small down payment. These are other options to compare:
- Conventional with 20% down. This skips mortgage insurance on a conventional loan.
- Combo loan. A combo loan uses a second loan to reach 20% down without paying all of it in cash. Terms vary by lender.
- Lender-paid mortgage insurance. The lender covers the insurance, and you pay for it with a higher interest rate. See our page on lender-paid mortgage insurance.
- VA loans. If you are eligible, a VA loan has no monthly mortgage insurance.
Your Next Steps
Here is a simple order to follow:
- Decide on your down payment. The jump from under 10% to 10% changes how long you pay.
- Check your loan amount. See if it is above or below $726,200.
- Ask for the full cost. Request your upfront premium, annual premium, and how long it lasts.
- Compare loan types. Look at FHA next to conventional and any other option you qualify for.
- Talk to us. We can run the numbers with your details.
FHA Mortgage Insurance FAQ
Here are answers to the questions buyers ask us most about FHA mortgage insurance.
How much is FHA mortgage insurance in 2026?
You pay an upfront premium of 1.75% of the base loan. The annual premium on most 30-year loans up to $726,200 is 0.50% or 0.55%, depending on your down payment.
Is FHA mortgage insurance the same as PMI?
No. FHA mortgage insurance is set by HUD and applies to FHA loans. PMI is private mortgage insurance on conventional loans. They protect the lender in similar ways but follow different rules.
Can I cancel FHA mortgage insurance?
Not at a set equity level. With 10% or more down, the annual premium ends after 11 years. With less down, it lasts for the life of the loan unless you refinance.
Do I pay FHA mortgage insurance up front?
Yes. The upfront premium is 1.75% of the base loan. Most buyers add it to the loan instead of paying it at closing.
Does my credit score change my FHA mortgage insurance rate?
No. FHA’s premium schedule is based on loan amount, loan term, and loan-to-value, not credit score.
Is FHA mortgage insurance cheaper on a 15-year loan?
Yes. Annual premiums on 15-year loans are lower. For loans up to $726,200, the rate is 0.15% with 10% or more down and 0.40% with less.
What if my loan is more than $726,200?
The annual premium is a little higher. The rate is 0.70% or 0.75% on loans with a term of more than 15 years.
When did FHA mortgage insurance rates drop?
HUD lowered the annual premiums for case numbers endorsed on or after March 20, 2023.
How can I avoid FHA mortgage insurance?
You cannot avoid it on an FHA loan. You can choose another loan type, such as a conventional loan with 20% down, or a VA loan if you qualify.
Do VA, USDA, and conventional loans have mortgage insurance too?
Each has its own cost. VA loans have no monthly mortgage insurance but do have a funding fee. USDA loans have a guarantee fee and an annual fee. Conventional loans use PMI when you put down less than 20%.
Ready to See Your Numbers?
Tell us your price range and your down payment, and we will show you what FHA mortgage insurance would cost and how it compares to other options. Check today’s rates, apply online, or call (262) 305-0680.
Taxes, insurance, and mortgage insurance will be part of the total monthly mortgage payment but are not included in the above examples. These examples are for illustrative purposes only and may differ from the current interest rate offered. Call for the current rate and full disclosure of current terms.
Union Home Mortgage is not acting on behalf of or at the direction of HUD, FHA, or the Federal Government. These materials are not from HUD or FHA and were not approved by HUD, FHA, or a government agency.
The information provided here is for informational purposes. When interest rates and loan program information are included, it is for illustration purposes only and not a solicitation or quote for services. This is not an advertisement or loan estimate. Current interest rates, loan programs and qualification criteria can change at any time. If you have questions or need assistance, we can be reached using the contact information above.
Union Home Mortgage Corp. does not provide tax, legal, credit repair, or accounting services. The information provided is generally true but may not apply to you or your situation. For tax or legal advice please consult an appropriate professional in one of these fields.
