Mortgage Insurance (PMI) Calculator

Put less than 20% down on a conventional loan and you'll likely pay private mortgage insurance (PMI) — protecting the lender, not you. This shows your monthly PMI and when it drops off.

Direct answer

What does this tool do?

Mortgage Insurance (PMI) Calculator computes the result directly in your browser — Put less than 20% down on a conventional loan and you'll likely pay private mortgage insurance (PMI) — protecting the lender, not you. This shows your monthly PMI and when it drops off. Nothing you enter is uploaded or stored.

What PMI is (CFPB): required on conventional loans with <20% down; it insures the lender, not the borrower. Cost: typically ~0.5%-1.0% of the loan amount annually (credit, LTV, and loan size move it) — an editable example here, never a lender quote. Cancellation: PMI auto-cancels at 78% LTV; you can request removal at 80% (typically after ~11 years on a 30-year with 10% down). Alternatives: lender-paid PMI (higher rate, no monthly premium) or an 80/10/10 piggyback — compare total cost.

How this calculator works

Monthly PMI = loan amount x PMI rate / 12. Conventional PMI typically 0.3%-1.5% annually, driven by LTV and credit; drops off at 78% LTV by law (requested at 80%).

Worked example

$300,000 loan at 0.5% annual PMI costs $125/month; at 0.9% it is $225/month, so the rate quote matters more than the loan size.

PMI cost drivers: loan-to-value and credit band determine the annual rate
PMI is priced on LTV and credit: the same loan can cost 3x more at a worse band.

FAQ

Is PMI worth it or should I wait for 20% down?

Waiting saves PMI but costs time and rent. A $30,000 down payment saved by waiting 3 years often costs more in rent than 3 years of PMI. Model both scenarios with your real numbers.

When does PMI go away?

It auto-cancels at 78% loan-to-value and you can request cancellation at 80% LTV, per federal rules (FHA MIP is different — it generally stays for the loan life on new loans).

Does PMI protect me if I can't pay?

No — it protects the lender against your default. You can still lose the home to foreclosure. It simply makes a low-down-payment loan possible for you.

Figures are editable example defaults for modeling, not quotes or advice. Financial, tax, and medical outcomes vary with your situation — verify with a qualified professional (CFP, CPA, tax advisor, or veterinarian).

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From quote to monthly cents, step by step

Say a home costs $350,000 and you put 10% down. The loan is $350,000 minus $35,000, so $315,000, and the starting LTV is 315,000 divided by 350,000, which is exactly 90%. A lender quotes PMI at 0.62% of the loan per year. Annual cost: 315,000 x 0.0062 = $1,953. Monthly: 1,953 / 12 = $162.75.

Now rerun the same house with 5% down. The loan becomes $332,500 (350,000 - 17,500) and LTV is 95%. That band usually carries a higher rate; assume 0.85%. Annual cost: 332,500 x 0.0085 = $2,826.25, monthly $235.52. So 5% down costs $17,500 less at closing but $72.77 more per month in PMI alone, and the higher LTV means a bigger principal balance for interest to ride on. This is why the tool needs your actual quote, not a rule of thumb: move the down payment 5 points and both the rate and the base it multiplies change.

What cancellation actually requires

Automatic termination under the Homeowners Protection Act is pegged to the ORIGINAL amortization schedule, not your actual balance. Extra principal payments do not speed up the 78% automatic date; you still have to request cancellation based on your real balance at 80%. Servicers routinely require a new appraisal to confirm value, typically $150 to $500, and a clean 12-month payment history: one payment 30+ days late inside that window restarts the clock.

Two edge cases bite. First, rising values: the servicer may only accept the original appraisal or a market-value opinion, so a $400,000 purchase now worth $500,000 may need equity proven against the ORIGINAL $400,000 basis, not the new value. Second, FHA loans: monthly MIP on most post-2013 loans lasts the life of the loan regardless of balance, so the only exit is refinancing into a conventional loan, which itself needs about 20% equity to avoid PMI. Model both exit paths before assuming PMI ends on a date.