How to Remove FHA Mortgage Insurance in 2025 (Simple Guide)

If you have an FHA loan, you’re probably paying monthly mortgage insurance — known as MIP (Mortgage Insurance Premium).

The good news? You don’t have to pay it forever.

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In this guide, we’ll break down when and how you can remove FHA mortgage insurance, using plain language and clear steps.

Can You Remove FHA Mortgage Insurance?

Yes, you can — but only in certain cases. Here’s how it works:

1. Automatic Removal (Only If You Put Down 10% or More)

• Loans before June 3, 2013: MIP can drop off after 5 years if you put 10% or more down.

• Loans after June 3, 2013: MIP drops off after 11 years — but again, only if you put at least 10% down.

If you didn’t put down at least 10%, your MIP lasts for the life of the loan.]

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Best Way to Remove FHA Mortgage Insurance: Refinance

If you don’t qualify for automatic removal, the most common way to eliminate MIP is by refinancing into a conventional loan.

You’ll likely qualify if:

• You have at least 20% equity in your home

• Your credit score is 620 or higher

• Your debt-to-income ratio is under 50%

• Your loan is in good standing with no missed payments

With 20% equity, you can switch to a conventional loan with no PMI (private mortgage insurance).

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How to Refinance to Remove FHA Mortgage Insurance

Here’s a step-by-step breakdown:

1. Check your home’s equity – Is it 20% or more?

2. Apply and submit documents – Income, employment, credit, etc.

3. Get a new appraisal – Your home must be worth enough to support the equity requirement.

4. Close on the new loan – Pay any closing costs and start fresh without FHA MIP.

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What If You Don’t Qualify Yet?

You still have options:

👉 FHA Streamline Refinance

• Quick and easy refinance for FHA loans

• No appraisal or income check

• Won’t remove MIP, but can lower your monthly payment

👉 Wait for Automatic Cancellation

• If you put 10% down, MIP may fall off after 11 years

• Mark your calendar and check with your lender when the time comes

👉 MIP Refund (If You Refinance Early)

If you refinance or sell within 3 years of your FHA loan, you could get part of your upfront MIP refunded:

• Year 1: Up to 80% refund

• Year 2: Around 60%

• Year 3: Around 40%

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FAQs

1. What is FHA mortgage insurance (MIP)?
It’s insurance you’re required to pay when you get an FHA loan. It protects the lender in case you default, not you. It includes an upfront fee and monthly payments added to your mortgage.

2. Can I remove FHA mortgage insurance without refinancing?
Only in a few situations — mainly if your loan is from before June 3, 2013, or you put down 10% or more and wait 11 years. Otherwise, refinancing is the only way.

3. When does FHA mortgage insurance automatically cancel?
If you put at least 10% down and your loan started after June 3, 2013, MIP cancels after 11 years. If you didn’t, it stays for the life of the loan.

4. What’s the fastest way to get rid of FHA mortgage insurance?
Refinancing into a conventional loan once you’ve built 20% equity in your home.

5. How much equity do I need to refinance out of FHA and avoid PMI?
You’ll typically need at least 20% equity to refinance into a conventional loan with no mortgage insurance.

6. What credit score is needed to refinance out of an FHA loan?
Most lenders require a 620 or higher, but a higher score may get you better rates.

7. Can I take cash out and still remove FHA mortgage insurance?
Yes — if you have enough equity. A conventional cash-out refinance allows up to 80% loan-to-value (LTV) and won’t require PMI if you stay at or below that threshold.

8. Is an FHA Streamline Refinance a good option if I can’t remove MIP?
Yes, it won’t remove MIP but can lower your rate and monthly payment. It’s fast, easy, and requires no appraisal or income check.

9. Can I get a refund on the upfront MIP I paid?
Yes — if you refinance or sell your home within the first 3 years of your FHA loan. The earlier you do it, the more you could get back.

10. Is it worth refinancing just to remove FHA mortgage insurance?
If you have 20% equity, decent credit, and current rates are good, then yes — refinancing can lower your monthly payment and save you thousands in the long run.

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Bottom Line

If you’re tired of paying FHA mortgage insurance, check if you can:

• Wait it out (if you put 10% down)

• Refinance to a conventional loan

• Use a streamline refinance to save in the short term

• Get a refund if your loan is still new

Talk to a lender to run the numbers. You might be closer than you think to ditching MIP for good.

Check Your FHA Loan Refinance Eligibility Today