Assumptions this tool makes. The term is 30 years throughout: HUD's schedule for terms of 15 years or less carries different rates and a different duration column, and that table is not part of this page, so no term is offered rather than offering a choice that would be half counted. The upfront premium is 175 basis points of the base loan amount and is added to the balance, so the payment is computed on the larger figure and interest accrues on the premium as well; where a lender collects it in cash instead, the payment falls but the same money has left the buyer's pocket. Loan-to-value is the base loan over the price and is not reduced by the financed premium. The annual premium rate is chosen by loan-to-value and by whether the base loan exceeds the national conforming loan limit, which is why the higher pair of rates at 0.70% and 0.75% applies to loans this page can produce but cannot place: FHA also publishes its own maximum mortgage limits county by county, and a base loan above the conforming limit in one county may not be insurable at all in another, so treat the higher band as a rate table rather than as a case that will price. The annual premium is recalculated each year on the declining balance rather than fixed on the original amount, so the monthly figure falls over the life of the loan and the first-year figure shown is the largest one; the total is the sum of those monthly charges up to the point the premium stops. Costs counted are the premiums themselves. Interest is not included anywhere in the headline figure, so a larger loan that carries a financed premium does cost more than the premium alone, and this page does not add that back; principal is excluded because the balance is repaid from the sale. Property tax, homeowners insurance, HOA dues and closing costs are all absent, and so is the partial refund of the upfront premium that can arise on a refinance into a new FHA loan. Whether to take an FHA loan at all, whether to refinance out of one, and how the same loan would price on another program are different questions and none of them is answered here.