Should I take FHA or conventional at 700 FICO?

Conventional typically wins at 700 FICO for any hold of 5 years or longer. PMI at this credit band runs roughly 0.45 to 0.55 percent annually and cancels under the Homeowners Protection Act at 78 percent LTV, typically around year 8. FHA MIP at 0.55 percent runs the full 30 years for under-10-percent down payments, with an upfront 1.75 percent UFMIP on top.

What conventional PMI rate at 700 FICO?

Major mortgage insurers including MGIC, Radian, and Essent typically price 700 to 719 FICO at 0.45 to 0.55 percent annual for 95 percent LTV in mid-2026. Single premium financed and split premium options can lower the monthly outlay; lender-paid PMI bakes the cost into a higher rate.

Are there scenarios where FHA still wins at 700 FICO?

Yes. Three cases. One: under-5-percent down payment where the conventional 97 percent LTV pricing exceeds FHA. Two: planned hold under 4 years where MI cancellation never matters. Three: property issues such as recent bankruptcy seasoning where FHA underwriting is more accommodating than Fannie or Freddie.

FHA vs Conventional with a 700 Credit Score

At 700 FICO, conventional typically wins for any hold of 5 years or longer. PMI at this band is roughly 0.45 to 0.55 percent and cancels at 78 percent LTV. FHA MIP at 0.55 percent runs the full 30 years for under-10 percent down.

Verdict

Conventional. The $25k+ savings on MI alone over a 10-year hold is decisive. The only exceptions are short holds (under 4 years), under-5 percent down, or property issues that benefit from FHA underwriting flexibility.

The math at 700 FICO on a $300k home, 5% down

Cost line	FHA 3.5% down	Conventional 5% down
Annual MI rate	0.55%	0.50%
Upfront MI	$5,066 UFMIP (rolled in)	$0
MI auto-cancels	Never (life of loan)	~Year 8 at 78% LTV
30-year MI total	~$47,520 + $5,066	~$11,400
10-year MI total (no refi)	~$15,800 + $5,066	~$11,400
Net conv savings (10-yr hold)	~$9,500 in MI plus the UFMIP avoidance

Where FHA still wins at 700 FICO

Down payment below 5%. Conventional 97 LTV at 700 FICO carries a 0.75 LLPA add (Fannie LLPA matrix), pushing the effective rate up roughly 0.15 percent. FHA at 3.5% down with no LLPA may price 0.20 to 0.30 percent cheaper despite the MIP duration.

Hold under 4 years. Conventional PMI does not cancel within this window in most cases, so the MIP-vs-PMI math collapses to monthly cost. They are within $40 per month at 700 FICO; FHA edges ahead if UFMIP is rolled in and you treat it as financed cost.

Property condition or seller dynamics. If the seller already prefers FHA (e.g. listed with FHA financing pre-approved), or the property already has FHA case number assigned for a previous fall-through, taking that path may avoid second appraisal cost.

Manual underwrite scenarios. Recent late payment, atypical income, or compensating-factor-led approval is more likely on FHA than Fannie DU at 700 FICO.

Recommended path at 700 FICO

Get quotes from at least 3 lenders for both FHA and conventional at your specific down payment.
Ask the lender for a side-by-side: rate, points, monthly MI, upfront MI, and break-even on any rate buy-down.
Confirm PMI cancellation calendar in writing per HPA 12 USC 4902.
For conventional, ask whether single-premium PMI (financed) makes sense at your hold horizon; some borrowers save 0.10 to 0.15 percent versus monthly PMI.

Rate disclaimer

PMI rates vary by insurer and lender. Consult a licensed loan officer for a quote on your specific FICO, LTV, occupancy, and loan amount.

Sources

Fannie Mae LLPA Matrix: LLPA matrix PDF
HUD ML 2024-04 (FHA MIP rates): HUD ML 2024-04
HPA 12 USC 4902 (PMI cancellation): 12 USC 4902

Related: 660 FICO | 740 FICO | MIP vs PMI cost