Mortgage Terms
How to Get Rid of PMI on an FHA Loan Without Refinancing
The honest answer is that FHA mortgage insurance rarely comes off by request. Here is exactly what decides when yours ends.
Homeowners call us about this every month, usually after a neighbor with a conventional loan bragged about getting their mortgage insurance cancelled. On an FHA loan the rules are different, they were rewritten in 2013, and the date on your file decides almost everything.
Key takeaways
- FHA annual MIP has no borrower cancellation request. It ends on a schedule fixed at closing, or it does not end at all.
- If your FHA case number was assigned on or after June 3, 2013, the deciding number is your loan-to-value at origination: 90% or less means 11 years of MIP, above 90% means MIP for the full mortgage term.
- Older FHA loans still cancel automatically at 78% loan-to-value, with a five-year minimum on terms longer than 15 years.
- Rising home values do not help. HUD measures against the original price or origination appraisal and states that new appraised values are not considered.
How to get rid of PMI on an FHA loan without refinancing
For most FHA loans written today, you cannot. FHA annual mortgage insurance is not cancellable on request the way conventional PMI is, so there is no letter you can send and no appraisal you can order that removes it. What you can do is find out which of three schedules your loan sits on, because one of them ends on its own.
Per HUD Mortgagee Letter 2013-04, for loans with FHA case numbers assigned on or after June 3, 2013:
- Original loan-to-value of 90.00% or less – annual MIP is assessed for the first 11 years of the loan term, then it stops.
- Original loan-to-value above 90.00% – annual MIP is assessed for the mortgage term, up to the first 30 years. On a 30-year FHA loan taken with the minimum 3.5% down, that means the life of the loan.
Because a 3.5%-down FHA purchase starts at 96.5% loan-to-value, most first-time buyers in Gilbert, Mesa, and Queen Creek land squarely in that second bucket. If that is you, the only real exit is a refinance into a different loan.
Why FHA MIP is not the same thing as conventional PMI
Borrowers use “PMI” for both, but they are separate products with separate law behind them. Private mortgage insurance on a conventional loan is governed by the Homeowners Protection Act, which gives you the right to request cancellation at 80% loan-to-value and requires automatic termination at 78%. FHA mortgage insurance premium is a government program that funds the Mutual Mortgage Insurance Fund, and it carries no equivalent borrower request right.
| FHA MIP | Conventional PMI | |
|---|---|---|
| Can you request removal? | No | Yes, at 80% LTV |
| Automatic termination | Only on the schedule set at closing | Required at 78% LTV |
| Does a new appraisal help? | No | Often yes, by servicer policy |
| Upfront premium | 1.75% of the base loan amount | Usually none |
| Ends when the loan is paid off | Yes | Yes |
| Priced on credit score | No, same for everyone | Yes, heavily |
Premium figures from HUD Mortgagee Letter 2023-05, effective for case numbers endorsed on or after March 20, 2023. For illustrative purposes only and subject to change.
Not sure which schedule your loan is on?
Send us your closing package and we will read the case number date, the origination loan-to-value, and the term, then tell you the actual month your MIP ends – or that it does not. We have done this for Arizona homeowners for 24 years, and there is no charge for the answer.
Check your FHA case number date before anything else
Everything above turns on one date, and it is not your closing date. The FHA case number is assigned when your lender first pulls the file, typically days to weeks before closing, and it appears on your Mortgage Insurance Certificate and on page one of most FHA closing documents. If you cannot find it, your servicer can tell you in a phone call.
If that case number was assigned before June 3, 2013, you are on the older and far friendlier rule set from HUD Handbook 4155.2, and your MIP does cancel automatically:
- Term longer than 15 years – annual MIP is cancelled when the loan reaches 78% loan-to-value, provided you have paid the annual MIP for at least five years.
- Term of 15 years or less – annual MIP is cancelled at 78% loan-to-value regardless of how long you have paid it.
There is a real opportunity buried in that older rule. HUD normally measures the 78% point using the loan’s scheduled amortization, but it also provides that where payments have been accelerated or modified, cancellation can be based on the actual amortization the servicing lender reports to FHA. On a pre-2013 loan, extra principal genuinely can pull that date forward – but only if your servicer reports it.
The most common thing we have to correct: FHA determines the 78% loan-to-value point using the lesser of the original sales price or the appraised value at origination, and HUD says plainly that new appraised values will not be considered. Phoenix-metro appreciation since 2020 has been substantial, and none of it counts here. A current value only matters inside a refinance, where it sets the new loan-to-value from scratch.
On an FHA loan, mortgage insurance is not something you cancel. It is something that was scheduled the day your case number was assigned.– Ken Starks, independent mortgage broker
What you can actually do without refinancing
- Get your case number assignment dateCall your servicer and ask for the FHA case number and the date it was assigned. Before June 3, 2013 puts you on the cancellable rule set; on or after that date does not.
- Find your loan-to-value at originationTake the base loan amount before any financed upfront MIP and divide it by the lesser of the purchase price or the origination appraised value. That percentage, not today’s, is the one FHA uses.
- Mark your MIP end date on the calendarIf your original loan-to-value was 90% or less on a post-2013 loan, count 11 years from your first payment. That is the month your payment drops, with nothing required from you.
- On a pre-2013 loan, ask the servicer in writingRequest confirmation of the projected 78% loan-to-value date and ask whether they will report actual rather than scheduled amortization if you pay extra principal. Get the answer in writing before you commit cash.
- If you are stuck on life-of-loan MIP, price the alternativeThat is the point where the math stops being about cancellation and starts being about whether a different loan costs you less overall. That is a five-minute conversation, not a project.
When refinancing out of FHA is the honest answer
If your case number is post-June 2013 and you started above 90% loan-to-value, refinancing into a conventional loan is the mechanism that removes the mortgage insurance. It is worth a serious look when your current loan-to-value has fallen below 80% through payments, appreciation, or both, because a conventional loan at that level carries no monthly mortgage insurance at all. Homeowners who bought in the East Valley several years ago are frequently there without realizing it.
The decision is not automatic, though, and we will tell you when it does not pencil. Refinancing resets your amortization, carries closing costs, and swaps your existing note rate for whatever the market offers today. If your current rate is well below where the market sits, the MIP savings can be smaller than the interest you give up. Run the total cost over how long you actually plan to keep the house, not over 30 years you will never see.
One more piece worth knowing: if you refinance from one FHA loan into another within three years, you may be eligible for a partial refund of the upfront MIP you already paid, applied to the new loan’s upfront premium. It does not apply when you leave FHA for conventional, but it belongs in the comparison.
Before you assume you are trapped, pull your original Closing Disclosure and check the loan-to-value. Buyers who put down 10% or more, or who used gift funds to get above the 10% mark, are on the 11-year clock rather than life-of-loan – and a surprising number of them do not know it. Eleven years sounds long until you realize you are seven years in.
Key terms
- MIP (Mortgage Insurance Premium)
- FHA’s mortgage insurance. Charged upfront at 1.75% of the base loan amount and again annually, paid monthly as part of your payment.
- PMI (Private Mortgage Insurance)
- The conventional-loan equivalent, provided by private insurers and cancellable under the Homeowners Protection Act.
- FHA case number
- The file number FHA assigns at the start of your loan. Its assignment date, not your closing date, determines which MIP rules govern your loan.
- LTV (Loan-to-Value)
- Your loan amount as a percentage of the property’s value. For MIP duration, FHA uses the value at origination and never a later one.
- Amortization schedule
- The month-by-month table of how your balance falls over the loan term. FHA normally uses the scheduled version, not your actual balance, to find the 78% point.
Frequently asked questions
How do you get rid of PMI on an FHA loan without refinancing?
For most FHA loans with a case number assigned on or after June 3, 2013, you cannot cancel the annual MIP by request. It ends on a schedule set at closing: after 11 years if your original loan-to-value was 90% or less, or it stays for the full mortgage term if your original loan-to-value was above 90%. Loans with case numbers assigned before June 3, 2013 follow the older rule and can cancel automatically once the loan reaches 78% loan-to-value, after at least five years of paid premiums on terms longer than 15 years. Outside those paths, refinancing is the exit.
Does paying my FHA loan down faster remove the MIP sooner?
On a post-June 2013 FHA loan, no. The 11-year and full-term durations are set by your loan-to-value at origination, so extra principal does not shorten them. On a pre-June 2013 loan it can help: HUD normally uses the scheduled amortization to find the 78% point, but where payments have been accelerated or modified, cancellation can be based on the actual amortization the servicer reports to FHA. Ask your servicer in writing.
My Arizona home went up in value. Does that cancel my FHA MIP?
No. FHA measures the 78% loan-to-value point against the lesser of the original sales price or the appraised value at origination, and HUD states that new appraised values will not be considered. Appreciation across Gilbert, Mesa, and Chandler does not move that number. A new appraisal only helps you inside a refinance, where the current value sets the new loan-to-value.
Is FHA MIP the same thing as PMI?
No, though borrowers use the terms interchangeably. PMI is private mortgage insurance on a conventional loan and can be requested off at 80% loan-to-value and must be terminated automatically at 78% under the Homeowners Protection Act. MIP is the government mortgage insurance on an FHA loan, with its own upfront and annual premiums and its own duration rules that give the borrower no cancellation request right.
Find out when your FHA MIP actually ends
Send us your loan details and we will tell you which rule governs your file, the date your mortgage insurance drops off, and whether leaving FHA is worth running the numbers on.