Example of a purchase on an FHA Loan on a $299K property. Still cheaper than paying rent.

1. Down Payment and Loan Amount

• Purchase Price: $299,000

• Down Payment (3.5%): $299,000 × 0.035 = $10,465

• Base Loan Amount: $299,000 – $10,465 = $288,535

2. FHA Upfront Mortgage Insurance Premium (UFMIP)

• UFMIP Rate: 1.75%

• UFMIP: $288,535 × 0.0175 = $5,049

• Total Loan Amount (with UFMIP): $288,535 + $5,049 = $293,584

3. Monthly Principal & Interest Payment

Interest Rate: 5.75%Term: 30 years (360 months)Monthly Rate (r): 5.75% ÷ 12 = 0.4792% = 0.004792

Formula:M = P [ r(1 + r)^n ] / [ (1 + r)^n – 1 ]

Plug in the numbers:

• P = $293,584

• r = 0.004792

• n = 360

Step-by-step:

• (1 + 0.004792)^360 ≈ 6.347

• Numerator: $293,584 × 0.004792 × 6.347 ≈ $8,934

• Denominator: 6.347 – 1 = 5.347

• M = $8,934 ÷ 5.347 ≈ $1,672

4. FHA Annual Mortgage Insurance Premium (MIP)

• Annual MIP Rate: 0.55%

• Annual MIP: $293,584 × 0.0055 = $1,615

• Monthly MIP: $1,615 ÷ 12 = $135

5. Estimated Property Tax & Home Insurance

• Property Tax (est, AZ 0.41%): $299,000 × 0.0041 = $1,226/yr ≈ $102/month

• Homeowner’s Insurance (est, AZ): $2,490/yr ≈ $208/month

6. Approximate Total Monthly Payment

• Principal & Interest:       $1,672

• FHA Monthly MIP:         $135

• Property Taxes (est):       $102

• Homeowner’s Insurance (est):   $208

Estimated Total Monthly Payment:$1,672 + $135 + $102 + $208 = $2,117/month

Summary Table

Component	Amount
Purchase Price	$299,000
Down Payment (3.5%)	$10,465
Base Loan Amount	$288,535
Loan Amount w/ UFMIP	$293,584
Principal & Interest	$1,672
FHA Monthly MIP	$135
Est. Taxes & Insurance	$310
Total Est. Payment	$2,117

Notes:

• This estimate does not include potential HOA dues.

• MIP will remain for the full loan term with <10% down.

• Actual taxes/insurance may differ by property and address.