How is FHA mortgage insurance (MIP) different from conventional PMI?

Both protect the lender if you default, but they work very differently. Conventional private mortgage insurance (PMI) applies when you put less than 20% down; it has no upfront fee, its cost depends heavily on your credit score, and it automatically cancels once you reach 78% loan-to-value (or you can request removal at 80%). FHA mortgage insurance (MIP) has two parts: an upfront premium of 1.75% of the loan (usually financed into the balance) plus an annual premium paid monthly. Crucially, on most FHA loans with low down payments, MIP lasts the entire life of the loan — the only way to remove it is to refinance into a conventional loan once you have enough equity. That permanence is a key reason buyers with good credit often prefer conventional financing despite FHA's easier qualifying. Weigh both at wealthserene.com/tools/loan-program-finder.