Can FHA MIP drop automatically?

If original LTV ≤ 90% and you’ve met the 11-year requirement (for >15-year terms), servicers generally cancel when the balance reaches 78% of original value. You may need to request; policies vary.

Does current appraised value matter?

For FHA MIP cancelation on the same loan, original value is used. Higher appraisals do not accelerate cancellation; a refi could leverage current value instead.

What if I make extra payments?

Extra principal can move you to 78% faster than the schedule. This tool uses scheduled amortization; you can estimate faster payoff by shortening the term or using a prepayment/refi calculator.

How do 15-year FHA loans differ?

<=15-year terms with original LTV <= 90% can drop MIP at 78% without the 11-year wait. This tool will show earlier removal when you enter a 15-year term.

Does rolling UFMIP into the loan change this?

Rolled-in UFMIP changes the starting balance. This tool uses the loan amount input as the balance; if UFMIP was financed, include it in the loan amount for more accurate timing.

Is refinancing better than waiting?

This tool doesn’t compare refi costs, but if rates are lower or you’ve gained equity, refinancing to a conventional loan without MIP could be cheaper than waiting. Run a refi breakeven to compare.

Do lender overlays change cancellation timing?

Some servicers may have additional requirements (seasoning, payment history). This tool uses baseline FHA rules; always confirm with your servicer.

Does the 11-year rule apply to 15-year terms?

No. The 11-year minimum applies to >15-year terms. For <=15-year terms, eligible loans can drop MIP once they reach 78% of original value.

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FHA MIP Removal Timing

Estimate when FHA MIP can drop off based on original LTV and amortization to 78% of original value.

Results

Original LTV: 96.50%
Eligible for removal (<=90% original LTV): 0
Months to potential removal: 0.00
Years to potential removal: 0.00

How to use this calculator

Enter your FHA loan amount and down payment percent.
Enter the interest rate and term.
See your original LTV and whether you’re even eligible for cancellation (<=90% original LTV).
If eligible, the tool amortizes the loan to the month it reaches 78% of original value, then applies the 11-year minimum for terms >15 years.
Review the estimated months/years to potential removal and plan whether to wait or consider refinancing.

Inputs explained

FHA loan amount: Original base loan amount for your FHA mortgage (before UFMIP roll-in if applicable).
Down payment %: Percent down at origination; drives original LTV and cancelability.
Interest rate (APR %): Your FHA loan APR; used to amortize toward 78% of original value.
Term (years): Loan length; terms >15 years trigger the 11-year minimum before MIP can drop.

How it works

Computes original LTV from loan amount and down payment.

If original LTV <= 90%, FHA can drop MIP after at least 11 years and reaching 78% of original value.

We amortize the loan to find when balance hits 78% of original value, then enforce the 11-year minimum.

Formula

Original LTV = loanAmount ÷ (loanAmount ÷ (1 − downPayment%)). Eligible if original LTV ≤ 90%. Amortize monthly: payment = P × r × (1+r)^n / ((1+r)^n − 1). Find month where balance ≤ 78% of original value; if term > 15 years, month must also be ≥ 132 (11 years). Months/years to removal reported from start.

When to use it

Planning when annual MIP might fall off to forecast lower monthly payments.
Deciding whether to refinance out of FHA into a conventional loan versus waiting for MIP removal.
Assessing total cost of keeping FHA vs refi when rates move lower or equity grows.
Explaining MIP timelines to a buyer comparing FHA vs conventional options.
Checking if a higher down payment at origination (<=90% LTV) enabled eventual cancellation.
Estimating MIP end date to align with other budget goals (childcare ending, car payoff).
Helping sellers/buyers understand MIP persistence when assuming an FHA loan.

Tips & cautions

If your original LTV was above 90%, MIP lasts for the full term—you’d need a refi to remove it.
For terms over 15 years, even eligible loans must pay MIP for at least 11 years; this tool enforces that minimum.
For <=15-year FHA loans, MIP can drop after 78% without the 11-year wait; shorten the term input to see that scenario.
This uses original value (purchase price/appraisal at origination). Rising home values don’t accelerate FHA MIP cancellation on the same loan.
If you rolled UFMIP into the loan, cancellation timing may vary; this tool focuses on base loan vs original value.
Compare the projected MIP end date to current refinance rates and costs to decide if a refi is worthwhile sooner.
If you make extra principal payments, you may reach 78% sooner; simulate by shortening the term or using a refi calculator for precision.
If your servicer uses midpoint-of-term cancellation (rare), confirm their policy; this tool uses the common 78% rule.
Keep escrow/tax/insurance changes in mind; MIP dropping lowers total payment but escrow can still move payment up.
Simplified FHA guidance; servicing policies vary and UFMIP roll-in can affect balances beyond this model.
Uses original value only; ignores current appraised value and appreciation.
Does not model extra payments explicitly; assumes scheduled amortization.
Does not cover streamline refinances, PMI rules for conventional loans, or lender overlays.
Assumes standard FHA MIP cancelation rules; check with your servicer for exact policy and required requests.

Worked examples

High LTV, not cancelable

Loan $350,000, Down 3.5%, Rate 6.5%, Term 30.
Original LTV > 90%, so MIP is life-of-loan. Eligible for removal = no; months/years to removal are not applicable.

Cancelable but 11-year minimum applies

Loan $300,000, Down 10%, Rate 6%, Term 30.
Original LTV = 90% → eligible. Amortization hits 78% at ~year 14, but must satisfy 11-year minimum anyway.
Estimated removal ≈ month 168 (14 years).

Shorter term, faster drop

Loan $300,000, Down 10%, Rate 6%, Term 15.
Original LTV = 90% → eligible. 15-year loans don’t require 11 years; hits 78% around year 8.
Estimated removal ≈ month 96 (8 years).

Not eligible due to LTV

Loan $250,000, Down 5%, Rate 5.75%, Term 30.
Original LTV > 90%; FHA MIP remains for the full term on this loan unless you refinance.

Extra payments accelerate 78% hit

Loan $320,000, Down 10%, Rate 6%, Term 30. Eligible for cancellation.
Without prepay, 78% at ~year 13–14; with $200/mo extra principal (not directly modeled here), you could reach 78% earlier.
Use this estimate as a baseline; apply a shorter term or refi calculator to quantify the faster payoff.

Deep dive

Use this FHA MIP removal calculator to see if and when your mortgage insurance can drop off.

Enter loan amount, down payment, rate, and term to check original LTV eligibility and the month you reach 78% of original value.

See the 11-year minimum for >15-year FHA terms and how it affects your MIP end date.

Test 15-year vs 30-year terms to compare how quickly MIP could end if your original LTV was 90% or lower.

Plan whether to wait for FHA MIP removal or refinance to a conventional loan without MIP.

Factor extra principal payments by using a shorter effective term to see how payoff speed affects MIP timing.

Share the projected MIP end date with your loan officer or servicer when requesting cancellation or planning a refi.

FAQs

Can FHA MIP drop automatically?: If original LTV ≤ 90% and you’ve met the 11-year requirement (for >15-year terms), servicers generally cancel when the balance reaches 78% of original value. You may need to request; policies vary.
Does current appraised value matter?: For FHA MIP cancelation on the same loan, original value is used. Higher appraisals do not accelerate cancellation; a refi could leverage current value instead.
What if I make extra payments?: Extra principal can move you to 78% faster than the schedule. This tool uses scheduled amortization; you can estimate faster payoff by shortening the term or using a prepayment/refi calculator.
How do 15-year FHA loans differ?: <=15-year terms with original LTV <= 90% can drop MIP at 78% without the 11-year wait. This tool will show earlier removal when you enter a 15-year term.
Does rolling UFMIP into the loan change this?: Rolled-in UFMIP changes the starting balance. This tool uses the loan amount input as the balance; if UFMIP was financed, include it in the loan amount for more accurate timing.
Is refinancing better than waiting?: This tool doesn’t compare refi costs, but if rates are lower or you’ve gained equity, refinancing to a conventional loan without MIP could be cheaper than waiting. Run a refi breakeven to compare.
Do lender overlays change cancellation timing?: Some servicers may have additional requirements (seasoning, payment history). This tool uses baseline FHA rules; always confirm with your servicer.
Does the 11-year rule apply to 15-year terms?: No. The 11-year minimum applies to >15-year terms. For <=15-year terms, eligible loans can drop MIP once they reach 78% of original value.

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Simplified FHA MIP guidance. Uses original value, scheduled amortization, and generic 78%/11-year rules; does not model servicer overlays, extra payments, or refinance comparisons. Confirm with your loan servicer before relying on cancellation timing. Not financial advice.