What factors can affect the cost of my FHA loan?


Understanding what your monthly payment or your interest rate will be is not enough. Ask for information about loans with the same loan amount, but with different loan terms or loan types so that you can compare that information. The costs associated with those loans can vary, painting a financially different picture for each one. Consider these things carefully:

Interest Rates

Ask questions about interest rates being offered and whether they are the lowest for that day or week. Learn the difference between fixed rate loans and adjustable rate mortgages (ARM).

Discount Points

These are offered to borrowers as a way to get a lower interest rate. If you are borrowing $150,000, a single point would cost $1,500 and would result in a lower monthly payment.


A home loan often involves many fees, such as loan origination or underwriting fees, broker fees, as well as transaction, settlement, and closing costs.

Down Payment

FHA loan rules require a minimum down payment of 3.5% for new purchase loans. There are down payment assistance programs  which you may qualify for that can help you with both down payment assistance and also closing cost.

Mortgage Insurance

These premiums are added to your FHA monthly mortgage payment and also come with an up-front charge.