How much equity do I need to refinance FHA to conventional?

At 20% equity or more, a conventional refinance requires no mortgage insurance at all — the clean exit from lifetime MIP. Between 5% and 20% equity you can still refinance to conventional, but you'd trade MIP for PMI, which only helps if the PMI is meaningfully cheaper.

Does an FHA streamline refinance remove MIP?

No. A streamline refinance keeps you in an FHA loan, and the MIP continues. Only refinancing into a conventional loan removes FHA mortgage insurance.

FHA to Conventional Refinance: The MIP Exit, Step by Step

Short answer: at ~20% equity, refinancing into a conventional loan removes FHA MIP entirely — no mortgage insurance on the new loan. The decision is three numbers: your equity, the rate spread between your FHA loan and today's conventional rates, and closing costs (2–5% of the loan). Rule of thumb: if the refi breaks even inside 3 years and you'll stay longer, do it.

Step 1 — know your equity, honestly

Equity = today's value minus your balance. The checker pulls a live estimate and computes it. Lender underwriting will use its own appraisal, so treat 20% as "20% with cushion" — at 22–25% estimated equity you're solidly in the zone; at 20.5%, one soft appraisal sinks the no-MI outcome.

Step 2 — the break-even math

Your annual MIP is typically 0.50–0.55% of the balance (about $135/month on a $300k balance) — that saving is guaranteed by the switch. The rate side can add or subtract: a 2024–2025 FHA loan at 6.5%+ often refinances flat or better, making the whole MIP saving pure gain. A 2020–2021 FHA loan at 3% faces a brutal rate trade — usually wait, unless MIP plus other factors still clear the math. Divide total closing costs by total monthly savings for your break-even month; under 36 with plans to stay is a green light.

The streamline trap, again: an "FHA streamline refi" is fast and cheap but keeps you in FHA — MIP survives. If a lender leads with it when you asked about removing mortgage insurance, they're solving their problem, not yours.

Step 3 — shop it like it's money, because it is

Get three quotes minimum on the same day (rates move daily), compare at the same points/credits structure, and make lenders compete on the loan estimate. A 0.125% rate difference on $300k is ~$25/month for 30 years. Credit unions and independent brokers frequently beat the big-name lenders on conventional refis.

Not at 20% yet?

PMI Watch tracks your equity monthly and alerts you the month the no-MI refi becomes available.

Watch for $6/mo

Sources: HUD Mortgagee Letter 2013-04 · Rocket Mortgage FHA guide · The Mortgage Reports. Reviewed July 2026.