What about an FHA Streamline refinance?
A Streamline replaces one FHA loan with another at a lower rate, with no appraisal and little paperwork, but it is still an FHA loan, so the annual premium continues under the same rules. A Streamline lowers the rate; it does not remove the insurance. Part of the original upfront premium is refunded toward the new one when you refinance FHA-to-FHA within three years.
Is FHA still worth it, then?
Often, yes. FHA exists so that a 580 credit score, a thin savings account or a past credit event does not keep you renting, and for buyers in that position the premium is the price of getting in the door years earlier. The plan that works is to treat the insurance as temporary: buy with FHA, build equity through payments and appreciation, then refinance into a conventional loan once the numbers favor it. We tell every FHA buyer what that second step will look like before they take the first.
Read more on our FHA home loans page, see how the program works in Michigan on FHA home loans in Michigan, or, if you already have an FHA loan and want to see whether a conventional refinance removes the premium, start with refinancing in Michigan or get a quote.
Premium rates and duration rules are HUD’s as of October 2026 and change by mortgagee letter. Figures are examples for illustration, not an offer of credit. MortgagePros, LLC, NMLS 1925352, is licensed in 39 states.
What about an FHA Streamline refinance?
A Streamline replaces one FHA loan with another at a lower rate, with no appraisal and little paperwork, but it is still an FHA loan, so the annual premium continues under the same rules. A Streamline lowers the rate; it does not remove the insurance. Part of the original upfront premium is refunded toward the new one when you refinance FHA-to-FHA within three years.
Is FHA still worth it, then?
Often, yes. FHA exists so that a 580 credit score, a thin savings account or a past credit event does not keep you renting, and for buyers in that position the premium is the price of getting in the door years earlier. The plan that works is to treat the insurance as temporary: buy with FHA, build equity through payments and appreciation, then refinance into a conventional loan once the numbers favor it. We tell every FHA buyer what that second step will look like before they take the first.
Read more on our FHA home loans page, see how the program works in Michigan on FHA home loans in Michigan, or, if you already have an FHA loan and want to see whether a conventional refinance removes the premium, start with refinancing in Michigan or get a quote.
Premium rates and duration rules are HUD’s as of October 2026 and change by mortgagee letter. Figures are examples for illustration, not an offer of credit. MortgagePros, LLC, NMLS 1925352, is licensed in 39 states.
What about an FHA Streamline refinance?
A Streamline replaces one FHA loan with another at a lower rate, with no appraisal and little paperwork, but it is still an FHA loan, so the annual premium continues under the same rules. A Streamline lowers the rate; it does not remove the insurance. Part of the original upfront premium is refunded toward the new one when you refinance FHA-to-FHA within three years.
Is FHA still worth it, then?
Often, yes. FHA exists so that a 580 credit score, a thin savings account or a past credit event does not keep you renting, and for buyers in that position the premium is the price of getting in the door years earlier. The plan that works is to treat the insurance as temporary: buy with FHA, build equity through payments and appreciation, then refinance into a conventional loan once the numbers favor it. We tell every FHA buyer what that second step will look like before they take the first.
Read more on our FHA home loans page, see how the program works in Michigan on FHA home loans in Michigan, or, if you already have an FHA loan and want to see whether a conventional refinance removes the premium, start with refinancing in Michigan or get a quote.
Premium rates and duration rules are HUD’s as of October 2026 and change by mortgagee letter. Figures are examples for illustration, not an offer of credit. MortgagePros, LLC, NMLS 1925352, is licensed in 39 states.
- Refinance into a conventional loan. This is the usual exit. Once you have about 20 percent equity by a new appraisal and the credit to qualify, a conventional refinance has no FHA premium at all, and no private mortgage insurance either at 80 percent loan-to-value or below. The arithmetic has to beat the closing costs, and if rates have risen since you bought, the premium saving has to be weighed against a higher rate. A licensed pro runs both numbers before anything is ordered.
- Wait out the 11 years. If you put 10 percent or more down, the premium ends after 11 years of payments without you doing anything.
- Pay the loan off. Selling the home or paying the balance in full ends the insurance with the loan.
What about an FHA Streamline refinance?
A Streamline replaces one FHA loan with another at a lower rate, with no appraisal and little paperwork, but it is still an FHA loan, so the annual premium continues under the same rules. A Streamline lowers the rate; it does not remove the insurance. Part of the original upfront premium is refunded toward the new one when you refinance FHA-to-FHA within three years.
Is FHA still worth it, then?
Often, yes. FHA exists so that a 580 credit score, a thin savings account or a past credit event does not keep you renting, and for buyers in that position the premium is the price of getting in the door years earlier. The plan that works is to treat the insurance as temporary: buy with FHA, build equity through payments and appreciation, then refinance into a conventional loan once the numbers favor it. We tell every FHA buyer what that second step will look like before they take the first.
Read more on our FHA home loans page, see how the program works in Michigan on FHA home loans in Michigan, or, if you already have an FHA loan and want to see whether a conventional refinance removes the premium, start with refinancing in Michigan or get a quote.
Premium rates and duration rules are HUD’s as of October 2026 and change by mortgagee letter. Figures are examples for illustration, not an offer of credit. MortgagePros, LLC, NMLS 1925352, is licensed in 39 states.
- Refinance into a conventional loan. This is the usual exit. Once you have about 20 percent equity by a new appraisal and the credit to qualify, a conventional refinance has no FHA premium at all, and no private mortgage insurance either at 80 percent loan-to-value or below. The arithmetic has to beat the closing costs, and if rates have risen since you bought, the premium saving has to be weighed against a higher rate. A licensed pro runs both numbers before anything is ordered.
- Wait out the 11 years. If you put 10 percent or more down, the premium ends after 11 years of payments without you doing anything.
- Pay the loan off. Selling the home or paying the balance in full ends the insurance with the loan.
What about an FHA Streamline refinance?
A Streamline replaces one FHA loan with another at a lower rate, with no appraisal and little paperwork, but it is still an FHA loan, so the annual premium continues under the same rules. A Streamline lowers the rate; it does not remove the insurance. Part of the original upfront premium is refunded toward the new one when you refinance FHA-to-FHA within three years.
Is FHA still worth it, then?
Often, yes. FHA exists so that a 580 credit score, a thin savings account or a past credit event does not keep you renting, and for buyers in that position the premium is the price of getting in the door years earlier. The plan that works is to treat the insurance as temporary: buy with FHA, build equity through payments and appreciation, then refinance into a conventional loan once the numbers favor it. We tell every FHA buyer what that second step will look like before they take the first.
Read more on our FHA home loans page, see how the program works in Michigan on FHA home loans in Michigan, or, if you already have an FHA loan and want to see whether a conventional refinance removes the premium, start with refinancing in Michigan or get a quote.
Premium rates and duration rules are HUD’s as of October 2026 and change by mortgagee letter. Figures are examples for illustration, not an offer of credit. MortgagePros, LLC, NMLS 1925352, is licensed in 39 states.
Short answer: sometimes. Whether FHA mortgage insurance ever comes off on its own depends on how much you put down and when the loan was made. For most FHA loans written today with less than 10 percent down, it does not, and the way out is a refinance. Here is how the rules work and what the premium actually costs you.
The two premiums on every FHA loan
FHA loans are insured by the Federal Housing Administration, and the borrower pays for that insurance in two parts.
- The upfront premium (UFMIP) is 1.75 percent of the base loan amount, charged once at closing. Almost everyone finances it into the loan rather than paying it in cash, so on a $300,000 loan the balance starts at $305,250.
- The annual premium (MIP) is charged on the outstanding balance and collected in twelve monthly instalments inside your payment. For a 30-year loan at or below $726,200, the rate is 0.55 percent a year with less than 5 percent down and 0.50 percent with 5 percent or more. Larger loans and 15-year terms have their own rates.
On that $300,000 loan the annual premium is about $1,650 in the first year, or roughly $137 a month, and it falls slowly as the balance falls. It is a real cost, and it is the main reason borrowers with stronger credit often end up cheaper on a conventional loan even when the FHA note rate looks lower. Compare the whole payment, not the rate.
How long the annual premium lasts
For FHA loans with case numbers assigned on or after June 3, 2013, which is nearly every FHA loan in force today, the duration depends on the loan-to-value ratio at the start.
| Down payment at closing | Starting loan-to-value | Annual premium lasts |
|---|---|---|
| Less than 10 percent | Above 90 percent | The full term of the loan |
| 10 percent or more | 90 percent or less | 11 years |
Most FHA buyers put down the 3.5 percent minimum, so for most FHA loans the annual premium stays for the life of the loan. Paying the balance down, or watching the home’s value rise, does not remove it. The federal Homeowners Protection Act, which lets conventional borrowers cancel private mortgage insurance at 80 percent of the original value, does not apply to FHA insurance.
Older loans, with case numbers before June 3, 2013, follow the earlier rule: on a 30-year term the annual premium cancels automatically once the balance reaches 78 percent of the original value, provided the loan is at least five years old. If you have had an FHA loan since before mid-2013, check your statement; the premium may already have dropped off.
The three ways it ends
- Refinance into a conventional loan. This is the usual exit. Once you have about 20 percent equity by a new appraisal and the credit to qualify, a conventional refinance has no FHA premium at all, and no private mortgage insurance either at 80 percent loan-to-value or below. The arithmetic has to beat the closing costs, and if rates have risen since you bought, the premium saving has to be weighed against a higher rate. A licensed pro runs both numbers before anything is ordered.
- Wait out the 11 years. If you put 10 percent or more down, the premium ends after 11 years of payments without you doing anything.
- Pay the loan off. Selling the home or paying the balance in full ends the insurance with the loan.
What about an FHA Streamline refinance?
A Streamline replaces one FHA loan with another at a lower rate, with no appraisal and little paperwork, but it is still an FHA loan, so the annual premium continues under the same rules. A Streamline lowers the rate; it does not remove the insurance. Part of the original upfront premium is refunded toward the new one when you refinance FHA-to-FHA within three years.
Is FHA still worth it, then?
Often, yes. FHA exists so that a 580 credit score, a thin savings account or a past credit event does not keep you renting, and for buyers in that position the premium is the price of getting in the door years earlier. The plan that works is to treat the insurance as temporary: buy with FHA, build equity through payments and appreciation, then refinance into a conventional loan once the numbers favor it. We tell every FHA buyer what that second step will look like before they take the first.
Read more on our FHA home loans page, see how the program works in Michigan on FHA home loans in Michigan, or, if you already have an FHA loan and want to see whether a conventional refinance removes the premium, start with refinancing in Michigan or get a quote.
Premium rates and duration rules are HUD’s as of October 2026 and change by mortgagee letter. Figures are examples for illustration, not an offer of credit. MortgagePros, LLC, NMLS 1925352, is licensed in 39 states.